ECON 102 PSU EXAM 1 BROWNREVIEW NEWEST ACTUAL EXAM WITH
COMPLETE QUESTIONS AND CORRECT VERIFIED ANSWERS (DETAILED
ANSWERS) ALREADY GRADED A+ 100%
benefits - <<ANSWER>>rewards, positives, payoffs
shift in ppc - <<ANSWER>>"more and better" more resources, more
workers, better technology
opportunity cost - <<ANSWER>>cost of next best opportunity you are
giving up
next highest value alternative thats sacrificed to get something else
value of the trade off
absolute advantage - <<ANSWER>>who can make more/is better at
performing a task than another
more than one good
comparative advantage - <<ANSWER>>lower opportunity cost in making a
product than another
one good
,when social costs and private costs differ this is a(n) -
<<ANSWER>>externality
marginal benefit - <<ANSWER>>downward sloping; big benefits at first
rationality assumption - <<ANSWER>>economists assume individuals act
as if motivated by self-interest and respond predictably to opportunities for
gain
Why are people irrational? - <<ANSWER>>-explained by short sidedness,
or imperfect information
-still assume people consider costs and benefits
economic analysis - <<ANSWER>>way of thinking about all decisions
incentive - <<ANSWER>>reward or a punishment for engaging in a
particular activity, whether personal, business or political, affect decision
making
positive incentives - <<ANSWER>>money, candy, extra credit, company
awards
negative incentives - <<ANSWER>>jail, tax, spanking, fines
profit - <<ANSWER>>very powerful incentive in the US market economy
self interest - <<ANSWER>>pursuit of goals, friendship, charity
people try to improve their own situation (as they see it, not necessarily as
others see it)
scarcity - <<ANSWER>>occurs when there is not enough of our "wants" at
a zero price. means we never have enough of everything, including time, to
satisfy our every desire
most basic concept of economics, will always exist
rationing must occur
Scarcity is NOT - <<ANSWER>>not a shortage
general and always present
, when quantity demanded is greater than quantity supplied
not the same as poverty- affects both rich and poor
examples of resources that are scarce - <<ANSWER>>oil, land, resources
housing
time
education
healthcare
goods that are scarce - <<ANSWER>>clothing, textbooks, food, electronics
services that are scarce - <<ANSWER>>plumbing, electricity, pedicure,
education
United states known as _______ with scarcity - <<ANSWER>>"service
economy"
economics - <<ANSWER>>the study of how people allocate their limited
(scarce) resources to satisfy their unlimited wants
the study of how people make choices
resources - <<ANSWER>>things used to produce goods and services to
satisfy peoples wants
wants - <<ANSWER>>what people would buy if their incomes were
unlimited
anything we place a positive value on
microeconomics - <<ANSWER>>the study of decision making undertaken
by individuals (or households) and by firms
like looking through a microscope to focus on the smaller parts of the
economy
macroeconomics - <<ANSWER>>the study of behavior of the economy as
a whole
deals with economy-wide phenomena
deals with aggregates, or totals- such as total output in an economy
examples of macroeconomics - <<ANSWER>>unemployment rate
interest rates
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