Econ 103 Final Exam Study Guide
Economics Correct Answer: the social science which seeks to understand how humans make decisions in the face of scarcity given unlimited wants
Scarcity Correct Answer: human wants for goods, services and resources exceed what is available
Factors of Produc...
Econ 103 Final Exam Study Guide
Economics Correct Answer: the social science which seeks to understand how
humans make decisions in the face of scarcity given unlimited wants
Scarcity Correct Answer: human wants for goods, services and resources exceed
what is available
Factors of Production Correct Answer: land, labor, capital
Gross Domestic Product (GDP) Correct Answer: the total dollar amount of all
final goods and services produced in a country in one year
Microeconomics Correct Answer: the branch of economics that studies the
economy of consumers or households or individual firms
Macroeconomics Correct Answer: the branch of economics that studies the overall
working of a national economy - growth, unemployment, inflation
Monetary Policy Correct Answer: economic policies conducted by the countries'
central bank, which manipulates the money supply, interest rates, or banking
regulation
Fiscal Policy Correct Answer: economic policies that involve government
spending and taxes
Command Economy Correct Answer: where economic decisions are passed down
from government authority and where the government owns the resources
Market Economy Correct Answer: economic decisions are decentralized, private
individuals own resources ad businesses supply goods and services based on
demand
Public Policy Correct Answer: the process by which a society makes and enforces
decisions on what behavior is acceptable and what is not
Private Correct Answer: the individual citizens
, Public Correct Answer: government
Nominal figures Correct Answer: current year data and statistics (has not been
adjusted for inflation)
Real figures Correct Answer: data and statistics that have been adjusted for
inflation
Real GDP Correct Answer: (Nominal GDP/Price Index) x 100
Base year Correct Answer: reference year for constructing an index and which is
usually assigned an arbitrary index value of 100
Per capita Correct Answer: per person
Human Development Index (HDI) Correct Answer: a summary measure of
average achievement in key dimensions of human development: a long and healthy
life, being knowledgeable and have a decent standard of living
Earmarks Correct Answer: parts of the budget set aside for specific projects
Intertemporal choice Correct Answer: where decisions made today can affect
choices facing individuals in the future
Tragedy of the Commons (collective-action problem) Correct Answer: situation in
which people acting individually and in their own interest use up commonly
available but limited resources, creating disaster for the entire community
positive economic statement Correct Answer: A statement that can be proved or
disproved by reference to facts
normative economic statement Correct Answer: an opinion, which cannot be
shown to be true or false by reference to the facts
Model Correct Answer: simplified version of how systems operate
Law of demand Correct Answer: P and Q are inversely related
Law of Supply Correct Answer: P and Q are directly related
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