KSU ECON 1000 FINAL QUESTIONS AND VERIFIED
ANSWERS |100% CORRECT | ALREADY GRADED A
Opportunity Cost Correct Answers value of the next valuable cost.
Every choice has a cost.
Sunk Cost Correct Answers A cost that has already been incurred and
thus cannot be recovered (sleeping in and skipping a class... win lose).
incentives Correct Answers a thing that motivates or encourages one to
do something.
economic system Correct Answers system of production, resource
allocation, exchange, and distribution of goods and services in a society
or a given geographic area.
Command Correct Answers group making decisions; bureaucratic;
group of bureaucrats making decisions; economic system in which the
means of production are publicly owned and economic activity is
controlled by a central authority that assigns quantitative production
goals and allots raw materials to productive enterprises. (North Korea)
laissez-faire Correct Answers an economic system in which transactions
between private parties are free from government interference such as
regulations, privileges, tariffs, and subsidies
market Correct Answers economy in which decisions regarding
investment, production, and distribution are based on market determined
,supply and demand, and prices of goods and services are determined in
a free price system; prices and trade control allocation. (Singapore)
mixed Correct Answers An economy that combines elements of
capitalism and socialism, mixing some individual ownership and
regulation. (USA)
economic freedom of the world index Correct Answers an annual
compilation of data representing factors which make a country
economically free; compendium of 42 government policies affecting
economic freedom based on objective data or independent surveys.
economic freedom Correct Answers individuals have economic freedom
when property they acquire without the use of force, fraud, or theft is
protected from physical invasions by others and they are free to use,
exchange, or give their property as long as their actions do not violate
the identical rights of others. An index of economic freedom should
measure the extent to which rightly acquired property is protected and
individuals are engaged in voluntary transactions.
black market Correct Answers non-legal market
inferior good Correct Answers type of good whose demand declines
when income rises. In other words, demand of inferior goods is
inversely related to the income of the consumer. Description: For
example, there are two commodities in the economy -- wheat flour and
jowar flour -- and consumers are consuming both.
, normal good Correct Answers good for which an increase in income
causes an increase in demand, or a rightward shift in the demand curve.
If demand increases as income increases, it is a normal good or a good
with a positive income elasticity of demand.
input Correct Answers resources or factors of production used in the
production of a firm's output
wealth increases and demand decreases - demand curve to the left (shift
in demand) change in quantity supply
specialization of labor Correct Answers think assembly line
production possibilities frontier Correct Answers total amount of output
of a society
Money is efficiency enhancing tool that helps us engage in exchange.
law of demand Correct Answers negative correlation; all else being
equal, as the price of a product increases (↑), quantity demanded falls
(↓) ; likewise, as the price of a product decreases (↓), quantity demanded
increases (↑).
law of supply Correct Answers fundamental principle of economic
theory which states that, all else equal, an increase in price results in an
increase in quantity supplied. In other words, there is a direct
relationship between price and quantity: quantities respond in the same
direction as price changes.
ANSWERS |100% CORRECT | ALREADY GRADED A
Opportunity Cost Correct Answers value of the next valuable cost.
Every choice has a cost.
Sunk Cost Correct Answers A cost that has already been incurred and
thus cannot be recovered (sleeping in and skipping a class... win lose).
incentives Correct Answers a thing that motivates or encourages one to
do something.
economic system Correct Answers system of production, resource
allocation, exchange, and distribution of goods and services in a society
or a given geographic area.
Command Correct Answers group making decisions; bureaucratic;
group of bureaucrats making decisions; economic system in which the
means of production are publicly owned and economic activity is
controlled by a central authority that assigns quantitative production
goals and allots raw materials to productive enterprises. (North Korea)
laissez-faire Correct Answers an economic system in which transactions
between private parties are free from government interference such as
regulations, privileges, tariffs, and subsidies
market Correct Answers economy in which decisions regarding
investment, production, and distribution are based on market determined
,supply and demand, and prices of goods and services are determined in
a free price system; prices and trade control allocation. (Singapore)
mixed Correct Answers An economy that combines elements of
capitalism and socialism, mixing some individual ownership and
regulation. (USA)
economic freedom of the world index Correct Answers an annual
compilation of data representing factors which make a country
economically free; compendium of 42 government policies affecting
economic freedom based on objective data or independent surveys.
economic freedom Correct Answers individuals have economic freedom
when property they acquire without the use of force, fraud, or theft is
protected from physical invasions by others and they are free to use,
exchange, or give their property as long as their actions do not violate
the identical rights of others. An index of economic freedom should
measure the extent to which rightly acquired property is protected and
individuals are engaged in voluntary transactions.
black market Correct Answers non-legal market
inferior good Correct Answers type of good whose demand declines
when income rises. In other words, demand of inferior goods is
inversely related to the income of the consumer. Description: For
example, there are two commodities in the economy -- wheat flour and
jowar flour -- and consumers are consuming both.
, normal good Correct Answers good for which an increase in income
causes an increase in demand, or a rightward shift in the demand curve.
If demand increases as income increases, it is a normal good or a good
with a positive income elasticity of demand.
input Correct Answers resources or factors of production used in the
production of a firm's output
wealth increases and demand decreases - demand curve to the left (shift
in demand) change in quantity supply
specialization of labor Correct Answers think assembly line
production possibilities frontier Correct Answers total amount of output
of a society
Money is efficiency enhancing tool that helps us engage in exchange.
law of demand Correct Answers negative correlation; all else being
equal, as the price of a product increases (↑), quantity demanded falls
(↓) ; likewise, as the price of a product decreases (↓), quantity demanded
increases (↑).
law of supply Correct Answers fundamental principle of economic
theory which states that, all else equal, an increase in price results in an
increase in quantity supplied. In other words, there is a direct
relationship between price and quantity: quantities respond in the same
direction as price changes.
