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22 Cards in this Set

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  • Back
We study economics due to the ________ of resources.
scarcity
The best thing you must give up to get something is called _____.
opportunity cost
The saying, "There is no such thing as a free lunch," exemplifies the economic concept called______.
opportunity cost
The phenomenon in which something must be given up to acquire something else is called a(n).
tradeoff
The productive resources used to produce products are also known as.
factors of production
or
inputs
The work time and work effort that people devote to producing products is called.
labor
The human resource that organizes land, labor, and capital into an enterprise that produces a product is called.
entrpreneurship
Claims that attempt to describe the world as it is are called _____ statements.
positive
Claims that attempt to prescribe how the world should be are called _____ statements.
normative
An economy characterized by freely determined prices and the free exchange of goods and services in markets is known as a(n) _______ economy.
market
An economy in which the government determines prices and production is known as a(n) ______ economy.
command
or
(centrally) planned
In recent years, most command economies have been engaged in the complex process of converting from a command to a _______ system.
market
The country that has been the most successful, in an economic sense, at converting from a command to a market system is ________.
china
A device that motivates people to take action, usually so as to increase economic efficiency, is called a(n) ________.
incentive
or
benefit/reward
One of the key elements of a market economy is that ________ be determined freely.
prices
Another key element of a market economy are private ______ rights.
property
The direct exchange of one product for another, without the use of money, is called ______.
barter
The ability of a person to perform an activity or produce a product at a lower opportunity cost than someone else is called _______.
comparative advantage
The ability of one person to produce all products at a lower cost than someone else is called _______.
absolute advantage
Ted and Tammy have only two points on their production possibilities frontiers. Ted can produce either 5 kites and 3 puzzles an hours or 3 kites and 4 puzzles and hours. Tammy can produce either 6 kites and 2 puzzles and hour or 2 kites and 5 puzzles and hour. What is Ted's opportunity cost of a kite?
1/2 puzzles per kite
Ted and Tammy have only two points on their produce either 5 kites and 3 puzzles an hour or 3 kites and 4 puzzles an hour. Tammy can produce either 6 kites and 2 puzzles and hour or 2 kites and 5 puzzles an hour. What is Tammy's opportunity cost of a kite.
3/4 puzzles per kite
Ted and Tammy have only two points on their production possibilities frontiers. Ted can produce either 5 kites and 3 puzzles an hour or 3 kites and 4 puzzles an hour. Tammy can produce either 6 kites and 2 puzzles an hour or 2 kites and 5 puzzles an hour. Who has a comparative advantage in producing kites?
Ted