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APEcnomics Ch1

STUDY GUIDE

Question	Answer
With what idea does the study of Economics began?	everyone cannot have all of what they want and need.
Air, food, water, and shelter necessary for survival are called	Needs
Items we desire, BUT are not considered needs are called	Wants
Economics is the	study of the decisions that a society makes in efforts to satisfy needs and wants with limited resources.
How people live, or what their level of economic prosperity might be is referred to as their ___________ in economics	Standard of living
In a modern society, like the U.S., a "decent standard of living" has to be more than just having the people's _____ met as defined in #2.	Needs
Would healthcare, education, medicine, electricity, gasoline, etc., be considered NEEDS in order for a decent standard of living to exist for people in the U.S.?	Yes
Physical objects like shoes, shirts, etc. are called ______, while the actions or activities that one performs for another are called	Services
List 3 services: (Really? use your head)	Barber, Dentist, Lawyer
All the goods and services we produce in our economic system are really	Scarce
What does scarcity mean?	Limit on something
What is a shortage?	When a production has been minimized because it hinders w/ profit-making. (Price isn't good enough)
Is scarcity the same as shortage? ___ Does Scarcity ALWAYS exist? ____	NO, YES
All the things we, as a society, use to produce goods and services are called resources. In Economics these resources are called the _______	Factors or production
List the 4 FACTORS OF PRODUCTION	Land, labor, Capital, Entrepreneurship
Materials found in nature that are used to produce things are called	Natural Resources
All natural resource are under the Factor of Production called____	land
The Factor of Production that involves the efforts that people devote to work, or a task in which they will be paid doing is called ____	Human Resources
All the HUMAN-made resources dedicated to the production of goods and services fall under the Factor of Production called	Labor
What are the two types of capital? 1_________ 2____________	1. Goods(Physical Goods) 2. Human (things you're doing to make yourself useful)
What term serves as a (synonym) for physical capital?	Capital Goods
Why is physical capital an important FOP?	IT saves people time & money
Why is a building considered physical capital?	Provides protection & space
What are the advantages that physical capital offers? (1)_____ (2)____ (3)_____	1. Saves time 2. Knowledge (3) more productivity (products)
The knowledge and skills a worker gains through education and experience is known as	Human Capital
The risk takers who are responsible for coming the resources used to create goods-services are known as ______	Entrepreneur
Match each with the appropriate FOP? (a) office building _____ (b) Assembly Line work ____ (c) a Tree used to make paper _____ (d) Unused soil _____ (e) Artist ______ (f) Student_______	A. Physical capital B. Labor C.Land or Natural resources D. Land or Natural resource E. Labor or Entrepreneur F. Human Capital or Capital
What did Clarence Birdseye discover AND to what did it lead?	Discovered that frozen food tasted just as good when thawed out; lead to create Frozen Food Industry.
What are trade-offs?	All the choices that were not chosen, but could have been done are trade-offs.
What exactly is an opportunity cost?	A special trade-off; the most desirable trade-off, (mostly down to two choices).
Explain the concept of marginal analysis or marginalism	Process of analyzing alternatives or choices. To make good economics decisions, you can + or - apart 2 get what you need; changes decision
What is a PPC?	What is a created on a PPP (Production Possibility Graph) (PRODUCTION POSSIBILITY CURVE)
What 3 important pieces of information can be learned from a PPC?	1. Are you experiencing efficient? 2. Opportunity cost 3. Is the economy shrinking or growing
Land, labor, Capital, and Entrepreneurship are called the	Factors of production (R4)
how is underutilization depicted on a PPC	What was wasted. (depicted inside a point on a curve).
Define the Law of Increasing Costs?	When you go towards producing another product than the original; host costs will happen.
What is another name for a Production Possibilities Curve	Production Possibility Frontier
On a PPC or PPF, what could guns and butter mean?	Guns: Military weapons Butter: Consumer Goods
Why must people make choices about the satisfaction of their needs-wants with goods and services?	FEP (Resources are scarce).
Graph, analyze, and provide answers to the PPC of PPF below?	eh....
Land	Term that refers to all natural resources that are used to produce goods and services
Underutilization	_____ of resources occurs when an economy uses fewer resources than it is capable of expending
Opportunity costs	A ____ is the most important sacrifice that results from making a decision
Entrepreneur	A person who starts a new business or develops an original idea.
Trade-offs	All decisions involve ____ because we must give up some alternatives when we choose a course of action.
Scarcity	Economists define ____ as "limited quantities of resources required to meet unlimited needs-wants."
Guns or Butter	Economists use the phrase ___ to describe the trade offs a country is forced to make when choosing military VS Consumer Goods Production
Gary Becker	Maintains that economics guides even life's most personal decision.
Economics resources	AKA factors of production
Thinking at the Margin	when decisions involve adding or subtracting one more unit to the whole.
Economics	A person who starts a new business or develops an original idea.

Created by: Linkzelda41

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