Econ 247 Midterm #1 Questions and Detailed Correct
Answers | Graded A+ | 2026/2027 Updated Edition |
Athabasca University
Economics - ANSWERS The study of how people allocate their limited
resources to satisfy their unlimited wants.
Resources - ANSWERS Things used to produce goods and services to satisfy
people's wants.
Wants - ANSWERS What people would buy if their incomes were unlimited.
Microeconomics - ANSWERS The study of decisions making undertaken by
individuals (or households) and by firms.
Aggregates - ANSWERS Total amounts or quantities. Aggregate demand, for
example, is total planned expenditures throughout a nation.
Rationality Assumption - ANSWERS The assumption that people do not
intentionally make decisions that would leave them worse off.
Ceteris Paribus Assumption - ANSWERS The assumption that nothing changes
except the factor of factors being studied.
, Behavioral Economics - ANSWERS An approach to the study of consumer
behavior that emphasizes psychological limitations and complications that
potentially interfere with rational decision making.
Bounded Rationality - ANSWERS The hypothesis that people are NEARLY, but
not fully, rational, so that they cannot examine every possible choice available to
them but instead use simple rules of thumb to sort among the alternatives that
happen to occur to them.
Positive Economics - ANSWERS Analysis that is STRICTLY limited to making
either purely descriptive statements or scientific predictions ; for example, "If A,
then B." A statement of WHAT IS.
Normative Economics - ANSWERS Analysis involving value judgments about
economic policies; relates to whether outcomes are good or bad. A statement of
WHAT OUGHT TO BE.
Incentives - ANSWERS Rewards or penalties for engaging in a particular
activity.
Scarcity - ANSWERS A situation in which the ingredients for producing the
things that people desire are insufficient to satisfy all wants at a zero price.
Production - ANSWERS Any activity that results in the conversion of resources
into products that can be used in consumption.
Answers | Graded A+ | 2026/2027 Updated Edition |
Athabasca University
Economics - ANSWERS The study of how people allocate their limited
resources to satisfy their unlimited wants.
Resources - ANSWERS Things used to produce goods and services to satisfy
people's wants.
Wants - ANSWERS What people would buy if their incomes were unlimited.
Microeconomics - ANSWERS The study of decisions making undertaken by
individuals (or households) and by firms.
Aggregates - ANSWERS Total amounts or quantities. Aggregate demand, for
example, is total planned expenditures throughout a nation.
Rationality Assumption - ANSWERS The assumption that people do not
intentionally make decisions that would leave them worse off.
Ceteris Paribus Assumption - ANSWERS The assumption that nothing changes
except the factor of factors being studied.
, Behavioral Economics - ANSWERS An approach to the study of consumer
behavior that emphasizes psychological limitations and complications that
potentially interfere with rational decision making.
Bounded Rationality - ANSWERS The hypothesis that people are NEARLY, but
not fully, rational, so that they cannot examine every possible choice available to
them but instead use simple rules of thumb to sort among the alternatives that
happen to occur to them.
Positive Economics - ANSWERS Analysis that is STRICTLY limited to making
either purely descriptive statements or scientific predictions ; for example, "If A,
then B." A statement of WHAT IS.
Normative Economics - ANSWERS Analysis involving value judgments about
economic policies; relates to whether outcomes are good or bad. A statement of
WHAT OUGHT TO BE.
Incentives - ANSWERS Rewards or penalties for engaging in a particular
activity.
Scarcity - ANSWERS A situation in which the ingredients for producing the
things that people desire are insufficient to satisfy all wants at a zero price.
Production - ANSWERS Any activity that results in the conversion of resources
into products that can be used in consumption.
