Econ 211 UTK exam 1 Questions With Highest Ratings
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Course
Econ 211 UTK
Institution
Econ 211 UTK
Economics
The study of how people make decisions given the scarcity of resources
Economics - Correct Answer The study of how people make decisions given the scarcity of resources
Incentives - Correct Answer a positive or negative environmental stimulus that motivates behavior
Ceteris Pa...
Econ 211 UTK exam 1 Questions With Highest
Ratings
Economics
The study of how people make decisions given the scarcity of resources
Economics - Correct Answer The study of how people make decisions given the scarcity of resources
Incentives - Correct Answer a positive or negative environmental stimulus that motivates behavior
Ceteris Paribus - Correct Answer meaning everything else stays the same
What 3 things can you never have enough of (scarcity and opportunity cost) - Correct Answer time,
money, and resources
Microeconomics - Correct Answer the study of how households and firms make decisions and how they
interact in markets
Economic model - Correct Answer a simplified version of reality used to analyze real-world economic
situations
positive analysis - Correct Answer analysis concerned with what is (can be answered using facts and
information)
normative analysis - Correct Answer analysis concerned with what ought to be (based on beliefs and/or
opinions
What is equity? - Correct Answer fairness
What are the three main assumptions in economics? - Correct Answer 1. People are rational
, 2. People are self interested (opposite is altruistic)
3. People respond to incentives
Marginal = - Correct Answer additional
Capitalist/ market economy - Correct Answer private individuals and firms own most of the resources,
innovation due to competition, government role is to protect property rights
Communist/ Planned economy - Correct Answer Most resources owned by the government
Mixed economy - Correct Answer is a mixture between capitalist/market and communist/planned
What are the four factors of production? - Correct Answer land, labor, capital, entrepreneurship
Investment = - Correct Answer purchase of new capital
Investment DOES NOT mean - Correct Answer investing in the stock market
PPF assumptions - Correct Answer all factors of production go towards the production of 2 goods
Linear PPF - Correct Answer opportunity cost is the slope (constant)
To shift PPF inward... - Correct Answer Destroy capital or other factors of production (natural disasters,
war)
To shift PPF outward... - Correct Answer technology, investing in new capital, increase human capital
What's the difference between a curved PPF and a linear PPF? - Correct Answer Curved is more realistic
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