ECON 1500 Exam 2025 With 100%
Correct Answers
What is Economics? - CORRECT ANSWER✔✔The study of people and the choices they make in a
world of scarcity.
4 Themes of Economics - CORRECT ANSWER✔✔-Definition of Economics
-Definition of supply
- Definition of Demand
-Mutually Beneficial Voluntary Exchange (if the trade is voluntary both parties benefit.)
Scarcity: - CORRECT ANSWER✔✔Anything that has a positive price is scarce.
-A thing that is add to be "scarce" if, at a zero price
4 Basic groups of Resources - CORRECT ANSWER✔✔1. Land
2. Labor
3. Capital
4. Entrepreneurial Abilities
Land Resource - CORRECT ANSWER✔✔all natural resources, or gifts of nature
Labor Resource - CORRECT ANSWER✔✔The physical and mental effort of workers
Capital Resource - CORRECT ANSWER✔✔man made resources used in producing things.
-Physical Capital: " "
, -Human Capital: The know-How: school to make yourself more marketable (knowledge)
Entrepreneurial Abilities - CORRECT ANSWER✔✔-The human resource that organizes labor,
land, and capital
- Take more risks
- Notice a need that is not being met
-License: research ( word of mouth); main employers/ creator of jobs; open for progress; see
them as heroes.
Scarce Resources Questions - CORRECT ANSWER✔✔1. What is to be produced? what the
consumer wants
2. how will it be produced? The way it has more net gain than the consumer
3. When will it be produced? ex. Christmas Trees not in July
4. Who is going to get it? The value determined by taste and preferences.
Methods - CORRECT ANSWER✔✔1. The market mechanism
2. Government Dictates: what, when, and for whom
3. Violence: let people get weapons and physically fight it out
-Equally and Efficiency
-Competition and Value
Rational Self Interest - CORRECT ANSWER✔✔People will make the choices that, at the time and
with the information they have at their disposal, will give them the greatest amount of
satisfaction for the effort or money they spend.
-Mutually Beneficial Voluntary Exchange
Common Mistakes in Economic Analysis - CORRECT ANSWER✔✔1. The fallacy that association is
causation
Correct Answers
What is Economics? - CORRECT ANSWER✔✔The study of people and the choices they make in a
world of scarcity.
4 Themes of Economics - CORRECT ANSWER✔✔-Definition of Economics
-Definition of supply
- Definition of Demand
-Mutually Beneficial Voluntary Exchange (if the trade is voluntary both parties benefit.)
Scarcity: - CORRECT ANSWER✔✔Anything that has a positive price is scarce.
-A thing that is add to be "scarce" if, at a zero price
4 Basic groups of Resources - CORRECT ANSWER✔✔1. Land
2. Labor
3. Capital
4. Entrepreneurial Abilities
Land Resource - CORRECT ANSWER✔✔all natural resources, or gifts of nature
Labor Resource - CORRECT ANSWER✔✔The physical and mental effort of workers
Capital Resource - CORRECT ANSWER✔✔man made resources used in producing things.
-Physical Capital: " "
, -Human Capital: The know-How: school to make yourself more marketable (knowledge)
Entrepreneurial Abilities - CORRECT ANSWER✔✔-The human resource that organizes labor,
land, and capital
- Take more risks
- Notice a need that is not being met
-License: research ( word of mouth); main employers/ creator of jobs; open for progress; see
them as heroes.
Scarce Resources Questions - CORRECT ANSWER✔✔1. What is to be produced? what the
consumer wants
2. how will it be produced? The way it has more net gain than the consumer
3. When will it be produced? ex. Christmas Trees not in July
4. Who is going to get it? The value determined by taste and preferences.
Methods - CORRECT ANSWER✔✔1. The market mechanism
2. Government Dictates: what, when, and for whom
3. Violence: let people get weapons and physically fight it out
-Equally and Efficiency
-Competition and Value
Rational Self Interest - CORRECT ANSWER✔✔People will make the choices that, at the time and
with the information they have at their disposal, will give them the greatest amount of
satisfaction for the effort or money they spend.
-Mutually Beneficial Voluntary Exchange
Common Mistakes in Economic Analysis - CORRECT ANSWER✔✔1. The fallacy that association is
causation
