WGU D089 Module 1 Complete Exam
Study Questions with 100% Correct
Answers | Brand New Version
1. What are the three fundamental questions every economy must answer?
Give an example of a "What" question. - ANSWER What to produce, how
it will be produced, and from whom the goods or services are produced.
What to produce (Oil vs. Cattle), How to (Current vs. New technology),
From who to produce
2. What do economists mean when they say that people "think at the margin"?
- ANSWER Thinking about the next step or an additional action means for
a person.
3. According to the 10 Principles of Economics, what determines a nation's
standard of living? - ANSWER Principle 8: Nations ability to produce
goods and services.
4. Using the 10 Principles of Economics, explain why trade is beneficial? -
ANSWER Principle 5: Trade leaves everyone in a better position. Allows
people to concentrate on what they do best and exchange their ability with
others.
5. How does printing money impact prices? - ANSWER Printing to much
money can cause prices to rise which causes inflation.
6. Economics - ANSWER Study of how humans make decisions in the face of
scarcity.
,7. Factors of production - ANSWER Describes the inputs used in the
production of goods or services to make an economic profit.
8. positive statement - ANSWER a factual claim that can be tested.
9. Is the following statement normative or positive?
The unemployment rate should be lower. - ANSWER Normative
10.rent - ANSWER payment to resource owners for the use of their natural
resources
11.wages - ANSWER payment to resource owners for their labor
12.interest - ANSWER payment to resource owners for the use of their capital
13.profit - ANSWER payment to entrepreneurship
14.Macroeconomics - ANSWER Branch of economics dealing with the
performance, structure, behavior, and decision-making of an economy as a
whole. Large economic think national or global
15.Microeconomics - ANSWER Branch of economics that studies the behavior
of individuals and firms in making decisions regarding the allocation of
scarce resources and the interactions among these individuals and firms.
think small like people and businesses.
16.Scarcity - ANSWER Basic economic problems, the gap between limited,
scarce, resources, and theoretically limitless wants.
, 17.What to Produce: - ANSWER Using the economy's scarce resources to
produce one thing requires giving up another. Every society must decide
what it will produce with its scarce resources.
18.opportunity cost - ANSWER The next best alternative that is given up when
a choice is made.
19.How to Produce it: - ANSWER There are all sorts of choices to be made in
determining how goods and services should be produced.
20.From whom to produce it: - ANSWER If a good or service is produced, a
decision must be made about who will get it. The decision if one person, or
group or service.
21.Principal 1 - ANSWER Everyone faces tradeoffs- People must decide what
they are willing to give up to get what they need or want, For example
person wants a new car but will spend most of her check and will forgo other
wants or needs.
22.Principal 2 - ANSWER The cost of Something is determined by what you
give up to get it - Opportunity cost is the value of the next best alternative.
Ex: Buying a new car and the person will give up other goods or services
that would have been bought if she didn't purchase the car.
23.Principal 3 - ANSWER Rational people think at the margin- people make
better decisions when they consider if the additional benefit, they gain from
one more unit is greater than the additional cost of that extra unit of a good
or service.
Study Questions with 100% Correct
Answers | Brand New Version
1. What are the three fundamental questions every economy must answer?
Give an example of a "What" question. - ANSWER What to produce, how
it will be produced, and from whom the goods or services are produced.
What to produce (Oil vs. Cattle), How to (Current vs. New technology),
From who to produce
2. What do economists mean when they say that people "think at the margin"?
- ANSWER Thinking about the next step or an additional action means for
a person.
3. According to the 10 Principles of Economics, what determines a nation's
standard of living? - ANSWER Principle 8: Nations ability to produce
goods and services.
4. Using the 10 Principles of Economics, explain why trade is beneficial? -
ANSWER Principle 5: Trade leaves everyone in a better position. Allows
people to concentrate on what they do best and exchange their ability with
others.
5. How does printing money impact prices? - ANSWER Printing to much
money can cause prices to rise which causes inflation.
6. Economics - ANSWER Study of how humans make decisions in the face of
scarcity.
,7. Factors of production - ANSWER Describes the inputs used in the
production of goods or services to make an economic profit.
8. positive statement - ANSWER a factual claim that can be tested.
9. Is the following statement normative or positive?
The unemployment rate should be lower. - ANSWER Normative
10.rent - ANSWER payment to resource owners for the use of their natural
resources
11.wages - ANSWER payment to resource owners for their labor
12.interest - ANSWER payment to resource owners for the use of their capital
13.profit - ANSWER payment to entrepreneurship
14.Macroeconomics - ANSWER Branch of economics dealing with the
performance, structure, behavior, and decision-making of an economy as a
whole. Large economic think national or global
15.Microeconomics - ANSWER Branch of economics that studies the behavior
of individuals and firms in making decisions regarding the allocation of
scarce resources and the interactions among these individuals and firms.
think small like people and businesses.
16.Scarcity - ANSWER Basic economic problems, the gap between limited,
scarce, resources, and theoretically limitless wants.
, 17.What to Produce: - ANSWER Using the economy's scarce resources to
produce one thing requires giving up another. Every society must decide
what it will produce with its scarce resources.
18.opportunity cost - ANSWER The next best alternative that is given up when
a choice is made.
19.How to Produce it: - ANSWER There are all sorts of choices to be made in
determining how goods and services should be produced.
20.From whom to produce it: - ANSWER If a good or service is produced, a
decision must be made about who will get it. The decision if one person, or
group or service.
21.Principal 1 - ANSWER Everyone faces tradeoffs- People must decide what
they are willing to give up to get what they need or want, For example
person wants a new car but will spend most of her check and will forgo other
wants or needs.
22.Principal 2 - ANSWER The cost of Something is determined by what you
give up to get it - Opportunity cost is the value of the next best alternative.
Ex: Buying a new car and the person will give up other goods or services
that would have been bought if she didn't purchase the car.
23.Principal 3 - ANSWER Rational people think at the margin- people make
better decisions when they consider if the additional benefit, they gain from
one more unit is greater than the additional cost of that extra unit of a good
or service.
