Economics 101 questions and accurate answers with 100% verification and grade A+

economics - ANSthe study of how people make choices under conditions of scarcity and of the results of those choices for society rational person - ANSsomeone with well-defined goals who tries to fulfill those goals as best as he or she can economic surplus - ANSthe benefit of taking any action minus its cost opportunity cost - ANSthe value of the next-best alternative that must be foregone in order to undertake the activity positive economics - ANSeconomic analysis that offers cause-and-effect explanations of economic relationships; the propositions, or hypotheses, that emrege from positive economics can, in principle, be confirmed or refuted by data; in principle, data can also be used to measure the magnitude of effects predicted by positive economics normative economics - ANSeconomic statements that reflect subjective value judgments and are based on ethical positions The Scarcity Problem - ANSHaving to make a choice- more of one good thing means having less of another The Cost-Benefit Principle - ANSAn individual will be better off taking an action if, and only if, the extra benefits from taking the action are greater than the extra costs time value of money - ANSthe fact that a given dollar amount today is equivalnet to a larger dollar amount in the future, because the money can be invested in an interest-bearing account in the meantime sunk cost - ANSa cost that is beyond recovery at the moment a decision must be made marginal cost - ANSthe increase in total cost that results from carrying out one additional unit of an activity marginal benefit - ANSthe increase in total benefit that results from carrying out one more unit of an activity