Economics Final Study Guide 2024

What is rationing?

• A system of allocating scarce goods and services

• A method of increasing production

• A way to reduce prices

• A process of advertising products

Marginal Cost is:

• The additional cost of producing one more unit

• The total cost of production

• The fixed cost of production

• The average cost per unit

A decision at the margin is:

• a choice made by comparing all alternatives at once

• a choice made by comparing the additional benefits and costs of a decision

• a decision made without considering opportunity cost

• a decision made only in the long run

Complete the study guide. Practice as much as possible before your final.

• Before your final

• After your final

• During your final

• Never

What are the three basic questions a country must answer?

• What to produce, how to produce, and for whom to produce

• Who will rule, how to rule, and when to rule

• What to import, how to import, and from where to import

• Who will pay taxes, how much to pay, and when to pay

Define or explain: Income Distribution.

• Income distribution refers to how a nation’s total earnings are divided among its people.

• Income distribution is the process of creating new sources of income for a country.

• Income distribution means the government collects all income and redistributes it equally.

• Income distribution refers to the total amount of money a country earns from exports.

Define or explain: Globalization.

• Globalization is the process by which businesses or other organizations develop international influence or start operating on an international scale.

• Globalization is the restriction of trade and communication between countries.

• Globalization is the process of isolating a country from the rest of the world.

• Globalization is the practice of only conducting business within a single country.

What are the responsibilities of people in a free enterprise economy?

What do economists believe people respond to?

• Economists believe people respond to incentives.

• Economists believe people respond to traditions.

• Economists believe people respond to emotions only.

• Economists believe people respond to random events.

What is the circular flow diagram?