ECON 1BB3 Chapter Notes - Chapter 1: Marginal Utility, Marginal Cost, Opportunity Cost
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19 Jan 2016
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Allocates scarce resources: societies also face many decisions decide what jobs need to be done and by who allocate output of goods and services. Scarcity: society has limited resources cannot produce all goods and services people want. Economics: study of how society manages its scarce resources: economists: study how people make decisions (how much they work, what they buy ) and how people interact with each other (buyers/sellers determine prices) Also analyze forces and trends that affect the economy. Economy reflects the behaviour of the individuals who make up the economy. Principle #1: people face trade-offs: making decisions requires trading off one goal against another, different trade-offs for different societies. Modern society: clean environment vs high level of income. Efficiency (getting the most from scarce resource) vs equity (benefits of resources are distributed fairly among members) Size of economic pie vs how the pie is divided into individual slices .
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21. The English word that comes from the Greek word for "one who manages a household" is
A- market
B- consumer
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D- economy
B- should be counted only to the extent that they are more expensive at college than elsewhere. C- usually exceed the opportunity cost of going to college. D- plus the cost of tuition, equals the opportunity cost of going to college. |
B- in most economies, wealthy people consume disproportionate quantities of goods and services. C- governments restrict the production of too many goods and services. D- resources are limited. |
B- markets guiding economic activity. Today many countries that did not have this system have implemented it. C- government guiding economic activity. Today many countries that had this system have abandoned it. D- government guiding economic activity. Today many countries that did not have this system have implemented it. |
B- we should agree with Senator Johnson. C- a good decision requires that we recognize both viewpoints. D- there are no tradeoffs between equity and efficiency. |
B- it does not matter if they charge $10 or $15. C- they would do better charging $15 than $10. D- they should raise the price even more. |
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Question 30. 30. For economists, statements about the world are of two types: |
A- assumptions and theories.
B- true statements and false statements.
C- specific statements and general statements.
D- positive statements and normative statements.