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Econ Exam Review
Economics
Question | Answer |
---|---|
the study of how individuals and societies make choices about ways to use scarce resources to fulfill their wants | economics |
items of value that can be seen and touched | goods |
the value of the next best alternative given up for the choice that was chosen | opportunity costs |
exchanging one thing for another | trade off |
ability of risk taking individuala to deliver new products | entrepreneurship |
items of value that cannot be seen or touched | services |
condition of not being able to have all the goods or services one wants | scarcity |
another name for natural resources present without human intervention | land |
which one of these is not one of the basic economic questions | when |
list four of the five factors of production | land- labor- capital- technology- entrepreneurship |
his writing established the basic economic thought in the united states | adam smith |
economic system in which basic economic activity stems from ritual, habit, or custom | traditional economy |
economic system in which basic economic decisions are made by a central authority | command economy |
economic system in which basic economic decisions are made by people and firms acting in their own best interests | market economy |
which of the following is not a major economic and social goal of the united states | economic interdependence |
economic goals are important because they | help people determine if an economic system meets their needs |
why is economic growth an important goal of the united states | economic growth is needed to better satisfy the wants and needs of a growing population |
economic system in which private citizens own the factors of production | capitalism |
the struggle among sellers to attract consumers while lowering costs | competition |
all of the following are characteristics of capitalism except | government control |
why are entrepreneurs important in a free enterprise economy | entrepreneurs start new businesses |
a business owned and run by one person | sole proprietorship |
business organization recognized by law as a separate legal entity having all the rights of an individual | corporation |
what is the most common form of business organization in the united states | sole proprietorship |
basic ownership of a corporation, including voting rights, takes the form of | common stock |
business combination of firms involved in different steps of manufacturing or marketing | vertical merger |
horizontal mergers involve | two or more firms that produce the same kind of product |
what is the law of demand | |
what is the law of supply | |
what is created when the price is set higher than the point where supply and demand meet | surplus |
what is created when the price is set lower than the point where supply and demand meet | shortage |
what is the name of the point where supply and demand meet | equilibrium |
when the government sets a cap on what price business can change citizens | price ceiling |
when there is a change in what people will buy because a change in price is called | price effect |
equilibrium is important because | it balances the amounts demanded and supplied |
if there is a surplus in a market, the price is likely to | decrease |
change in price that creates a shift in demand along the demand curve | price effect |
products that tend to be used together | complements |
actual price and quantity sold is determined in market | invisible hand |
deals with behavior and decision making of small units | microeconomics |
money that a government has declared to be legal tender | fiat money |
money that has an alternative use as an economic good | commodity money |
how many federal reserve banks are there | 12 |
which reserve bank is closest to west orange | atlanta |
money loses its value when it | becomes too plentiful |
in the organization of the federal reseve, this group meets to discuss interest rates and well being of the economy | open market committee |
name the two men who developed our monetary system | hamelton and franklin |
what percent are most banks required to keep reseve with the federal reserve | 10 percent |
relatively high tax on socially undesirable products, such as tobacco | sin tax |
tax on tangible and intangible possessions, such as real estate, buildings, furniture, stocks, bonds, and bank accounts | property tax |
tax on people's earnings | individual income tax |
medicare and fica | payroll taxes |
taxes that imposes a higher percentage rate of taxation on people with higher incomes than on people with lower income | progressive tax |
profits from the sale of an asset held for 12 months | capital gains |
tax on the manufacture and sale of selected items | excise tax |
the authority to levy a federal income tax comes from | the sixteenth amendment |
intergovernmental revenues are generally intended for | education and public welfare |