WGU - D089 - PRINCIPLES OF ECONOMICS QUESTIONS AND ANSWERS 2025
Economics - (ANSWER)The study of how humans make decisions in the face of scarcity.
Factors of Production - (ANSWER)Describes theninputs used in the production of goods or services to
make an economic profit.
Macroeconomics - (ANSWER)A branch of economic dealing with the performance, structure, behavior
and decision making of an economy as a whole.
Microeconomics - (ANSWER)A branch of economics that studies the behavior of individuals, and firms in
making decisions regarding the allocation of scarce resources and the interactions among these
individuals and firms.
Scarcity - (ANSWER)The basic economic problem, the gap between limited, scarce, resources and
theoretically limitless wants
Opportunity Cost - (ANSWER)The next best alternative that is given up when a choice is made.
Think at the Margin - (ANSWER)Thinking about what the next step or an additional action means for a
person.
Marginal Benefit - (ANSWER)The incremental increase in the benefit to a consumer caused by the
consumption of one additional unit of a good or service.
1st (Principles of Economics ) - (ANSWER)Everyone faces tradeoffs
2nd (Principles of Economics ) - (ANSWER)The cost of something is determined by what you give up to
get it.
3rd (Principles of Economics ) - (ANSWER)Rational people think at the margin.
,WGU - D089 - PRINCIPLES OF ECONOMICS QUESTIONS AND ANSWERS 2025
4th (Principles of Economics ) - (ANSWER)People respond to incentives.
5th (Principles of Economics ) - (ANSWER)Trade can benefit everyone.
6th (Principles of Economics ) - (ANSWER)Markets are a sound method of organizing economic activity.
7th (Principles of Economics ) - (ANSWER)Government may be able to improve market outcomes.
8th (Principles of Economics ) - (ANSWER)A nation's standard of living depends on its ability to produce.
9th (Principles of Economics ) - (ANSWER)Printing too much money causes prices to rise.
10th (Principles of Economics ) - (ANSWER)There is short-run tradeoff between inflation and
unemployment.
Economic Systems - (ANSWER)A system of the production, resource allocation, and distribution of goods
and services within a society or give geographic area.
Traditional Economy - (ANSWER)A economic system that relies on customs, history. and time-honored
beliefs. Guides economic decisions such as production and distribution.
Command Economy - (ANSWER)An economic system in which production, investment, prices, and
incomes are determined centrally by a government.
(Centralized)
Market Economy - (ANSWER)An economic system in which the decisions regarding investment,
production, and distribution are guided by the price signals created by the forces of supply and demand
, WGU - D089 - PRINCIPLES OF ECONOMICS QUESTIONS AND ANSWERS 2025
(Decentralized)
Mixed Economy - (ANSWER)An economic system in which both private enterprise and a degree of state
monopoly (usually in public services, defense, infrastructure, and basic industries) coexist.
Positive Economics - (ANSWER)The study of economics concerned with what is and what will happen if a
course of action is taken or not taken.
Normative Economics - (ANSWER)The study of economics with what is and what will happen if a course
of action is taken or not taken.
Economic Models - (ANSWER)A simplified version of reality that allows people to observe, understand
and make predictions about economic behavior.
Economic Indicators - (ANSWER)A statistic about an economic activity.
Circular Flow Model - (ANSWER)An economic model that shows the flow of money and goods through
the economy. The most common form of this model shows the circular flow of income between the
household sector and the business sector.
Human Capital - (ANSWER)The accumulated skills and education of workers.
Research and Development - (ANSWER)Term commonly used to describe the activities undertaken by
firms and other entities such as individual entrepreneurs to create new or improved products and
processes.
Partnership - (ANSWER)A legal form of business operation between two or more individuals who share
management and profits.
Merger - (ANSWER)Combining two companies into a single larger company
Economics - (ANSWER)The study of how humans make decisions in the face of scarcity.
Factors of Production - (ANSWER)Describes theninputs used in the production of goods or services to
make an economic profit.
Macroeconomics - (ANSWER)A branch of economic dealing with the performance, structure, behavior
and decision making of an economy as a whole.
Microeconomics - (ANSWER)A branch of economics that studies the behavior of individuals, and firms in
making decisions regarding the allocation of scarce resources and the interactions among these
individuals and firms.
Scarcity - (ANSWER)The basic economic problem, the gap between limited, scarce, resources and
theoretically limitless wants
Opportunity Cost - (ANSWER)The next best alternative that is given up when a choice is made.
Think at the Margin - (ANSWER)Thinking about what the next step or an additional action means for a
person.
Marginal Benefit - (ANSWER)The incremental increase in the benefit to a consumer caused by the
consumption of one additional unit of a good or service.
1st (Principles of Economics ) - (ANSWER)Everyone faces tradeoffs
2nd (Principles of Economics ) - (ANSWER)The cost of something is determined by what you give up to
get it.
3rd (Principles of Economics ) - (ANSWER)Rational people think at the margin.
,WGU - D089 - PRINCIPLES OF ECONOMICS QUESTIONS AND ANSWERS 2025
4th (Principles of Economics ) - (ANSWER)People respond to incentives.
5th (Principles of Economics ) - (ANSWER)Trade can benefit everyone.
6th (Principles of Economics ) - (ANSWER)Markets are a sound method of organizing economic activity.
7th (Principles of Economics ) - (ANSWER)Government may be able to improve market outcomes.
8th (Principles of Economics ) - (ANSWER)A nation's standard of living depends on its ability to produce.
9th (Principles of Economics ) - (ANSWER)Printing too much money causes prices to rise.
10th (Principles of Economics ) - (ANSWER)There is short-run tradeoff between inflation and
unemployment.
Economic Systems - (ANSWER)A system of the production, resource allocation, and distribution of goods
and services within a society or give geographic area.
Traditional Economy - (ANSWER)A economic system that relies on customs, history. and time-honored
beliefs. Guides economic decisions such as production and distribution.
Command Economy - (ANSWER)An economic system in which production, investment, prices, and
incomes are determined centrally by a government.
(Centralized)
Market Economy - (ANSWER)An economic system in which the decisions regarding investment,
production, and distribution are guided by the price signals created by the forces of supply and demand
, WGU - D089 - PRINCIPLES OF ECONOMICS QUESTIONS AND ANSWERS 2025
(Decentralized)
Mixed Economy - (ANSWER)An economic system in which both private enterprise and a degree of state
monopoly (usually in public services, defense, infrastructure, and basic industries) coexist.
Positive Economics - (ANSWER)The study of economics concerned with what is and what will happen if a
course of action is taken or not taken.
Normative Economics - (ANSWER)The study of economics with what is and what will happen if a course
of action is taken or not taken.
Economic Models - (ANSWER)A simplified version of reality that allows people to observe, understand
and make predictions about economic behavior.
Economic Indicators - (ANSWER)A statistic about an economic activity.
Circular Flow Model - (ANSWER)An economic model that shows the flow of money and goods through
the economy. The most common form of this model shows the circular flow of income between the
household sector and the business sector.
Human Capital - (ANSWER)The accumulated skills and education of workers.
Research and Development - (ANSWER)Term commonly used to describe the activities undertaken by
firms and other entities such as individual entrepreneurs to create new or improved products and
processes.
Partnership - (ANSWER)A legal form of business operation between two or more individuals who share
management and profits.
Merger - (ANSWER)Combining two companies into a single larger company
