Exam (elaborations)
Eco 201 exam 1 Detailed Questions and Expert Answers
- Course
- ECO 201
- Institution
- Southern New Hampshire University
Eco 201 exam 1 Detailed Questions and Expert Answers
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Eco 201 exam 1 Detailed Questions and ExpertAnswers
Economics - ANS the study of the choices that individuals make the given presence
of scarcity/ the study of how human beings coordinate their wants
scarcity - ANS limited resources but unlimited wants
Types of Resources (Factors of production) - ANS 1. Land: natural resources
2. Nonhuman animal resources
3. Labors: Human Capital
4. Capital: Resources produced using land and labor
5. Technology
6. Entrepreneurial Ability
The economy - ANS the institutional structure through which individuals in a
society coordinate their diverse wants
Economic agents in the economy - ANS 1. households
2. firms
3. government
, Issues of Allocation/ 3 Big Economic Questions - ANS 1. what and how much to
produce
2. how to produce it
3. for whom to produce it
economize - ANS getting the maximum benefit at the minimum cost
Economic Decision Rule - ANS if the marginal benefit of an action exceeds the
marginal cost, do it
Economic theory - ANS generalizations about the working of an abstract economy
economic models - ANS designed to duplicate reality in a simple way
positive statement - ANS a statement that can be tested, proven or disproven
Normative Statement - ANS A statement of opinion, cannot be proven or
disproven
Invisible Hand - ANS is the price mechanism. prices rise when quantity supplied is
less than quantity demanded
Invisible Handshake - ANS Social and historical forces and cultural norms that
influence market outcomes
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