ECON 102 Exam 1 Questions With Correct
Answers
Economic Analysis - CORRECT ANSWER✔✔-People making decisions economic
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wat of thinking
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Choices: Costs and Benefits - CORRECT ANSWER✔✔-Performing a certain
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economic action will increase our well-being if the benefits are greater than the
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costs (choices are the result of scarcity)
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Self Interest - CORRECT ANSWER✔✔-The pursuit of one's own goals (does not
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always mean increasing one's wealth; could also include prestige, friendship, love,
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and feeling good)
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Rationality Assumption - CORRECT ANSWER✔✔-The assumption that people do
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not intentionally make decisions that leave them worse off
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Incentive - CORRECT ANSWER✔✔-A reward or punishment for engaging in an
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activity (positive - money, candy, extra credit, company awards, negative - tax,
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spanking, jail, overdraft fees, fines) | | | |
Scarcity - CORRECT ANSWER✔✔-Occurs when there is not enough of our "wants"
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at a price of zero (is not a shortage and is not the same thing as poverty)
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, Definition of Economics - CORRECT ANSWER✔✔-The study of how people
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allocate their limited (scarce) resources to satisfy their unlimited wants (the study
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of how people make choices)
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Resources - CORRECT ANSWER✔✔-Things used to produce goods and services to
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satisfy people's wants (inputs)
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Wants - CORRECT ANSWER✔✔-What people would buy if their incomes were
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unlimited
Microeconomics - CORRECT ANSWER✔✔-The study of decision making | | | | | | | |
undertaken by individuals (or households) and by firms (i.e. Worker - Work
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overtime?, Family - Have a baby?, Firm - Advertise? How much?)
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Macroeconomics - CORRECT ANSWER✔✔-The study of the behavior of the | | | | | | | | | |
economy as a whole (i.e unemployment rate, rate of growth in the money supply
| | | | | | | | | | | | | |
(inflation), government's budget deficit)
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Economics as a Science - CORRECT ANSWER✔✔-Economics is an empirical (data,
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numbers, predictions) science, and uses models
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Ceteris Paribus - CORRECT ANSWER✔✔-All other things equal
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Models - CORRECT ANSWER✔✔-Simplified representations of the real world used
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as the basis for predictions or explanations
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Answers
Economic Analysis - CORRECT ANSWER✔✔-People making decisions economic
| | | | | | | |
wat of thinking
| |
Choices: Costs and Benefits - CORRECT ANSWER✔✔-Performing a certain
| | | | | | | | |
economic action will increase our well-being if the benefits are greater than the
| | | | | | | | | | | | |
costs (choices are the result of scarcity)
| | | | | |
Self Interest - CORRECT ANSWER✔✔-The pursuit of one's own goals (does not
| | | | | | | | | | | |
always mean increasing one's wealth; could also include prestige, friendship, love,
| | | | | | | | | |
and feeling good)
| | |
Rationality Assumption - CORRECT ANSWER✔✔-The assumption that people do
| | | | | | | | |
not intentionally make decisions that leave them worse off
| | | | | | | |
Incentive - CORRECT ANSWER✔✔-A reward or punishment for engaging in an
| | | | | | | | | | |
activity (positive - money, candy, extra credit, company awards, negative - tax,
| | | | | | | | | | | |
spanking, jail, overdraft fees, fines) | | | |
Scarcity - CORRECT ANSWER✔✔-Occurs when there is not enough of our "wants"
| | | | | | | | | | |
at a price of zero (is not a shortage and is not the same thing as poverty)
| | | | | | | | | | | | | | | | |
, Definition of Economics - CORRECT ANSWER✔✔-The study of how people
| | | | | | | | | |
allocate their limited (scarce) resources to satisfy their unlimited wants (the study
| | | | | | | | | | |
of how people make choices)
| | | | |
Resources - CORRECT ANSWER✔✔-Things used to produce goods and services to
| | | | | | | | | | |
satisfy people's wants (inputs)
| | |
Wants - CORRECT ANSWER✔✔-What people would buy if their incomes were
| | | | | | | | | | |
unlimited
Microeconomics - CORRECT ANSWER✔✔-The study of decision making | | | | | | | |
undertaken by individuals (or households) and by firms (i.e. Worker - Work
| | | | | | | | | | | |
overtime?, Family - Have a baby?, Firm - Advertise? How much?)
| | | | | | | | | |
Macroeconomics - CORRECT ANSWER✔✔-The study of the behavior of the | | | | | | | | | |
economy as a whole (i.e unemployment rate, rate of growth in the money supply
| | | | | | | | | | | | | |
(inflation), government's budget deficit)
| | |
Economics as a Science - CORRECT ANSWER✔✔-Economics is an empirical (data,
| | | | | | | | | | |
numbers, predictions) science, and uses models
| | | | |
Ceteris Paribus - CORRECT ANSWER✔✔-All other things equal
| | | | | | |
Models - CORRECT ANSWER✔✔-Simplified representations of the real world used
| | | | | | | | |
as the basis for predictions or explanations
| | | | | | |
