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ECON 200 exam 1 questions with actual responses
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ECON 200 exam 1 questions with actual responses
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ECON 200 exam 1 questions with actualresponses
economics CORRECT ANSWERS study of how societies choose to allocate their
scarce resources
what type of science is economics CORRECT ANSWERS social science
who allocates things CORRECT ANSWERS humans
what are two valuable resources to society CORRECT ANSWERS time and energy
what questions does economics ask CORRECT ANSWERS why are things the way that
they are?
and looking from a materialistic standpoint, humans did it, why?
what are the two types of economics CORRECT ANSWERS macro and micro
microeconomics CORRECT ANSWERS deals with individuals, why they buy/consume,
or make things. example: bread; why do people want to make/consume bread?
market CORRECT ANSWERS people buying things from each other
the two components of a market CORRECT ANSWERS buyers (consumers) and
sellers (producers)
law of demand CORRECT ANSWERS the higher the price of something, the less you
want to purchase it
excess demand CORRECT ANSWERS selling out of things because lots of people
want it cheap. more demand than items to buy
demand curve CORRECT ANSWERS models the buyers behavior. the higher the price,
the more incentive it is to produce it and make profit.
decentralized allocation CORRECT ANSWERS no authority or government telling you
what to do, you can buy or sell if you want to or not if you don't want to.
private property CORRECT ANSWERS you can own something and nobody can take it,
but if they want it they need incentive to get it (exchanging or buying it off of someone)
world of markets CORRECT ANSWERS micro
, the entire economy CORRECT ANSWERS macro
simplification of the hive of US economic activity CORRECT ANSWERS growth,
unemployment, inflation, and business cycle
what does the hive of activity produce CORRECT ANSWERS social welfare
social welfare CORRECT ANSWERS imagining a quality of life for society, the average
happiness of a person in society
unemployment CORRECT ANSWERS seriously correlated with social welfare. if
unemployment is up, society is worse off because less product is produced. leads to
drugs and crime
business cycle example CORRECT ANSWERS when people lose their jobs, they can't
consume lots, and it causes a recession. when people can't buy, others can't sell
economist job CORRECT ANSWERS they predict things, but don't accept it. if they
predict a recession, they use policy to stop or prevent it
what did economics start as CORRECT ANSWERS philosophy
why do we want policy CORRECT ANSWERS to make social welfare better
(manipulating society/intervention)
the data on social welfare CORRECT ANSWERS there is none, there are only mere
correlations. for example, more educated individuals, the better off welfare is, but this is
only a loose correlation.
output CORRECT ANSWERS amount of stuff we produce is strongly correlated with
better social welfare. BROAD assumption (right and wrong)
gross domestic product (GDP) CORRECT ANSWERS the government collects data on
GDP, can look at how to get more GDP through testing and experiments.
1) market value
2) of newly produced
3) final goods and services
4) produced within the country's boarders
5) over a given period of time
how much does government purchases add to GDP CORRECT ANSWERS 20%
things that don't go to market / bad measure of output CORRECT ANSWERS
homegrown / home done goods
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