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WGU - D089 PRINCIPLES OF ECONOMICS
EXAM | COMPREHENSIVE Q&A FOR
GUARANTEED PASS
Economics - correct-answer-The study of how humans make decisions in the face of
scarcity.
Factors of Production - correct-answer-Describes theninputs used in the production of
goods or services to make an economic profit.
Macroeconomics - correct-answer-A branch of economic dealing with the
performance, structure, behavior and decision making of an economy as a whole.
Microeconomics - correct-answer-A 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.
Scarcity - correct-answer-The basic economic problem, the gap between limited,
scarce, resources and theoretically limitless wants
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Opportunity Cost - correct-answer-The next best alternative that is given up when a
choice is made.
Think at the Margin - correct-answer-Thinking about what the next step or an
additional action means for a person.
Marginal Benefit - correct-answer-The incremental increase in the benefit to a
consumer caused by the consumption of one additional unit of a good or service.
1st (Principles of Economics ) - correct-answer-Everyone faces tradeoffs
2nd (Principles of Economics ) - correct-answer-The cost of something is determined
by what you give up to get it.
3rd (Principles of Economics ) - correct-answer-Rational people think at the margin.
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4th (Principles of Economics ) - correct-answer-People respond to incentives.
5th (Principles of Economics ) - correct-answer-Trade can benefit everyone.
6th (Principles of Economics ) - correct-answer-Markets are a sound method of
organizing economic activity.
7th (Principles of Economics ) - correct-answer-Government may be able to improve
market outcomes.
8th (Principles of Economics ) - correct-answer-A nation's standard of living depends
on its ability to produce.
9th (Principles of Economics ) - correct-answer-Printing too much money causes prices
to rise.
10th (Principles of Economics ) - correct-answer-There is short-run tradeoff between
inflation and unemployment.
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Economic Systems - correct-answer-A system of the production, resource allocation,
and distribution of goods and services within a society or give geographic area.
Traditional Economy - correct-answer-A economic system that relies on customs,
history. and time-honored beliefs. Guides economic decisions such as production and
distribution.
Command Economy - correct-answer-An economic system in which production,
investment, prices, and incomes are determined centrally by a government.
(Centralized)
Market Economy - correct-answer-An economic system in which the decisions
regarding investment, production, and distribution are guided by the price signals
created by the forces of supply and demand
(Decentralized)
WGU - D089 PRINCIPLES OF ECONOMICS
EXAM | COMPREHENSIVE Q&A FOR
GUARANTEED PASS
Economics - correct-answer-The study of how humans make decisions in the face of
scarcity.
Factors of Production - correct-answer-Describes theninputs used in the production of
goods or services to make an economic profit.
Macroeconomics - correct-answer-A branch of economic dealing with the
performance, structure, behavior and decision making of an economy as a whole.
Microeconomics - correct-answer-A 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.
Scarcity - correct-answer-The basic economic problem, the gap between limited,
scarce, resources and theoretically limitless wants
,2|Page
Opportunity Cost - correct-answer-The next best alternative that is given up when a
choice is made.
Think at the Margin - correct-answer-Thinking about what the next step or an
additional action means for a person.
Marginal Benefit - correct-answer-The incremental increase in the benefit to a
consumer caused by the consumption of one additional unit of a good or service.
1st (Principles of Economics ) - correct-answer-Everyone faces tradeoffs
2nd (Principles of Economics ) - correct-answer-The cost of something is determined
by what you give up to get it.
3rd (Principles of Economics ) - correct-answer-Rational people think at the margin.
,3|Page
4th (Principles of Economics ) - correct-answer-People respond to incentives.
5th (Principles of Economics ) - correct-answer-Trade can benefit everyone.
6th (Principles of Economics ) - correct-answer-Markets are a sound method of
organizing economic activity.
7th (Principles of Economics ) - correct-answer-Government may be able to improve
market outcomes.
8th (Principles of Economics ) - correct-answer-A nation's standard of living depends
on its ability to produce.
9th (Principles of Economics ) - correct-answer-Printing too much money causes prices
to rise.
10th (Principles of Economics ) - correct-answer-There is short-run tradeoff between
inflation and unemployment.
, 4|Page
Economic Systems - correct-answer-A system of the production, resource allocation,
and distribution of goods and services within a society or give geographic area.
Traditional Economy - correct-answer-A economic system that relies on customs,
history. and time-honored beliefs. Guides economic decisions such as production and
distribution.
Command Economy - correct-answer-An economic system in which production,
investment, prices, and incomes are determined centrally by a government.
(Centralized)
Market Economy - correct-answer-An economic system in which the decisions
regarding investment, production, and distribution are guided by the price signals
created by the forces of supply and demand
(Decentralized)
