ECON 102 FINAL EXAM ISU EXAM
QUESTIONS WITH VERIFIED SOLUTIONS
LATEST UPDATE
Economies of Scale --CORRECT ANSWER--As the level of
production increases, the average cost of producing each individual
unit declines
Microeconomics --CORRECT ANSWER--The individual units that
make up the whole of the economy
Macroeconomics --CORRECT ANSWER--Looks at economy as a
whole, broad perspective/ large picture
Fiscal Policy --CORRECT ANSWER--Government spending and
taxes. Federal, state, and city. Conducted by Congress, executive
branch, and the nation's legislative body
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,Monetary Policy --CORRECT ANSWER--manipulating money
supply, manipulating interest rates, changing bank regulations.
Conducted by Central Bank
Economics --CORRECT ANSWER--a social science that seeks to
understand how humans make decisions in the face of scarcity
Scarcity --CORRECT ANSWER--One word- Limits
factors of production --CORRECT ANSWER--land, labor, capital
Division and specialization of labor --CORRECT ANSWER--the
process in which workers select specialized tasks to make a product
Specialization --CORRECT ANSWER--when workers or firms focus
on particular tasks for which they are well-suited within the overall
production process
Adam Smith, The Wealth of Nations --CORRECT ANSWER--people
work for money not kindness of their heart
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, circular flow diagram --CORRECT ANSWER--a diagram that views
the economy as consisting of households and firms interacting in a
goods and services market and a labor market. Businesses send
wages, salaries, benefits, and goods and services to households.
Households send Labor services and payment for goods and services
to businesses.
Command Economy (Communism) --CORRECT ANSWER--an
economic system where economic decisions are passed down
(through hierarchy) from government planners where factors of
production are owned by the government
Market Economy (Capitalism) --CORRECT ANSWER--
decentralized and by the people not the govt. Free market
Market --CORRECT ANSWER--interaction between potential buyers
and sellers; a combination of demand and supply
underground economy --CORRECT ANSWER--buyers and sellers
make transactions without the govt's approval. Drugs, weapons, not
reporting cash
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QUESTIONS WITH VERIFIED SOLUTIONS
LATEST UPDATE
Economies of Scale --CORRECT ANSWER--As the level of
production increases, the average cost of producing each individual
unit declines
Microeconomics --CORRECT ANSWER--The individual units that
make up the whole of the economy
Macroeconomics --CORRECT ANSWER--Looks at economy as a
whole, broad perspective/ large picture
Fiscal Policy --CORRECT ANSWER--Government spending and
taxes. Federal, state, and city. Conducted by Congress, executive
branch, and the nation's legislative body
Page | 1
,Monetary Policy --CORRECT ANSWER--manipulating money
supply, manipulating interest rates, changing bank regulations.
Conducted by Central Bank
Economics --CORRECT ANSWER--a social science that seeks to
understand how humans make decisions in the face of scarcity
Scarcity --CORRECT ANSWER--One word- Limits
factors of production --CORRECT ANSWER--land, labor, capital
Division and specialization of labor --CORRECT ANSWER--the
process in which workers select specialized tasks to make a product
Specialization --CORRECT ANSWER--when workers or firms focus
on particular tasks for which they are well-suited within the overall
production process
Adam Smith, The Wealth of Nations --CORRECT ANSWER--people
work for money not kindness of their heart
Page | 2
, circular flow diagram --CORRECT ANSWER--a diagram that views
the economy as consisting of households and firms interacting in a
goods and services market and a labor market. Businesses send
wages, salaries, benefits, and goods and services to households.
Households send Labor services and payment for goods and services
to businesses.
Command Economy (Communism) --CORRECT ANSWER--an
economic system where economic decisions are passed down
(through hierarchy) from government planners where factors of
production are owned by the government
Market Economy (Capitalism) --CORRECT ANSWER--
decentralized and by the people not the govt. Free market
Market --CORRECT ANSWER--interaction between potential buyers
and sellers; a combination of demand and supply
underground economy --CORRECT ANSWER--buyers and sellers
make transactions without the govt's approval. Drugs, weapons, not
reporting cash
Page | 3
