C719 – MACROECONOMICS.
Designed to boost confidence and grades!
Scarcity - Answer: The inability to satisfy everyone's wants
Microeconomics - Answer: Study of individual and business choices in the economy
Macroeconomics - Answer: Study of the economy as a whole
Opportunity cost - Answer: The full value of the best alternative that is given up or
forgone.
Production possibilities curve - Answer: Curve showing the various output combinations
of two goods or groups of goods that can be produced in an economy with the available
resources.
Straight PPC - Answer: All resources are alike and can be interchanged
Curved PPC - Answer: Some resources are better suited to the production of one item
over another
Ceteris Paribus - Answer: Latin for "all else being equal", test hypotheses by looking at
actual experiences in markets.
Self-interested behavior - Answer: Consists of people trying to get the most of
something they want out of available resources
Factors of production - Answer: Labor, land, capital, and entrepreneurship
Goods - Answer: Objects that people value
Services - Answer: Tasks performed by people
1
APPHIA - Crafted with Care and Precision for Academic Excellence.
, Labor - Answer: The physical and mental work of human beings
Wages - Answer: Payments labor receives for its productive services
Human capital - Answer: Knowledge and skills that increase labor's productivity
Land - Answer: All natural resources that can be used as inputs to production
Rent. - Answer: The income paid to the factor of production called land
Capital - Answer: All aids to production that are human creations rather than resources
found in nature
Interest - Answer: A reward for giving up present consumption in order to make
resources available for the creation of more capital for future production
Investment - Answer: The act of adding to capital
Entrepreneurship - Answer: Consists of the activities of combining the other productive
resources to produce goods and services, taking risks, and introducing new methods
and new products (innovation)
Profit - Answer: The reward for innovation, risk taking, and organization
Market - Answer: Any setting in which buyers and sellers meet to exchange goods,
services, or productive resources
Three basic economic questions - Answer: What goods and services will be produced
and in what quantities? How will they be produced? For whom will they be produced?
2
APPHIA - Crafted with Care and Precision for Academic Excellence.
Designed to boost confidence and grades!
Scarcity - Answer: The inability to satisfy everyone's wants
Microeconomics - Answer: Study of individual and business choices in the economy
Macroeconomics - Answer: Study of the economy as a whole
Opportunity cost - Answer: The full value of the best alternative that is given up or
forgone.
Production possibilities curve - Answer: Curve showing the various output combinations
of two goods or groups of goods that can be produced in an economy with the available
resources.
Straight PPC - Answer: All resources are alike and can be interchanged
Curved PPC - Answer: Some resources are better suited to the production of one item
over another
Ceteris Paribus - Answer: Latin for "all else being equal", test hypotheses by looking at
actual experiences in markets.
Self-interested behavior - Answer: Consists of people trying to get the most of
something they want out of available resources
Factors of production - Answer: Labor, land, capital, and entrepreneurship
Goods - Answer: Objects that people value
Services - Answer: Tasks performed by people
1
APPHIA - Crafted with Care and Precision for Academic Excellence.
, Labor - Answer: The physical and mental work of human beings
Wages - Answer: Payments labor receives for its productive services
Human capital - Answer: Knowledge and skills that increase labor's productivity
Land - Answer: All natural resources that can be used as inputs to production
Rent. - Answer: The income paid to the factor of production called land
Capital - Answer: All aids to production that are human creations rather than resources
found in nature
Interest - Answer: A reward for giving up present consumption in order to make
resources available for the creation of more capital for future production
Investment - Answer: The act of adding to capital
Entrepreneurship - Answer: Consists of the activities of combining the other productive
resources to produce goods and services, taking risks, and introducing new methods
and new products (innovation)
Profit - Answer: The reward for innovation, risk taking, and organization
Market - Answer: Any setting in which buyers and sellers meet to exchange goods,
services, or productive resources
Three basic economic questions - Answer: What goods and services will be produced
and in what quantities? How will they be produced? For whom will they be produced?
2
APPHIA - Crafted with Care and Precision for Academic Excellence.
