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PSU Econ 102 Exam 1 Questions and Correct Answers the Latest Update and Recommended Version $10.49   Add to cart

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PSU Econ 102 Exam 1 Questions and Correct Answers the Latest Update and Recommended Version

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  • Course
  • PSU Econ 102
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  • PSU Econ 102

Economics → Study of the choices people make to attain their goals, given their scarce resources Macroeconomics → Study of the economy as a whole → Ex: Economic growth, unemployment, inflation Microeconomics → Study of decision making by individuals and firms, along with how the gover...

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  • October 20, 2024
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  • PSU Econ 102
  • PSU Econ 102
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2 0 2 4 /2025 | © copyright | This work may not be copied for profit gain Excel!


PSU Econ 102 Exam 1 Questions and
Correct Answers the Latest Update and
Recommended Version
Economics


→ Study of the choices people make to attain their goals, given their scarce resources


Macroeconomics

→ Study of the economy as a whole
→ Ex: Economic growth, unemployment, inflation


Microeconomics

→ Study of decision making by individuals and firms, along with how the government
influences those decisions


Rational Individuals


→ Weigh all the benefits and costs of each action
→ (Assumption that consumers and firms use all available information as they act to
achieve their goals)


Incentive

→ Factor that motivates a person to act or exert effort


Positive Incentive


→ Rewards action


Negative Incentive



1|Page| GradeA+ | 2 0 0 2 5

, 2 0 2 4 /2025 | © copyright | This work may not be copied for profit gain Excel!

→ Punishes action


Marginal Analysis


→ Requires decision makers to evaluate whether the benefit of one more unit of
something is greater than its cost


Margin

→ Extra/additional


Trade-offs

→ Occur because time and resource are scarce


Opportunity Cost


→ Highest valued alternative that must be sacrificed in order to get something


Trade

→ Voluntary exchange of goods and services between two or more parties (makes all
parties better off)
→ -Specialization is key


Positive Analysis


→ Concerned with WHAT IS
→ Ex: unemployment rate IS 6.7%


Normative Analysis




1|Page| GradeA+ | 2 0 0 2 5

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