Less of a good freely available than people would like - ANSWER-scarcity
Human made resources (such as tools, equipment, and structures) used to
... [Show More] produce other goods and services. - ANSWER-Capital
The highest valued alternative that must be sacrificed as a result of choosing an option. - ANSWER-Opportunity Cost
The subjective benefit or satisfaction a person expects from a choice or course of action. - ANSWER-Utility
A condition in which the amount of good offered for sale by producers is greater than the amount that buyers will purchase at the the existing price. - ANSWER-surplus
A condition in which the amount of good offered for sale by producers is less than the amount that buyers will purchase at the the existing price. - ANSWER-Shortage
A state in which the conflicting forces of demand and supply are in balance; quantity demanded will equal the quantity supplied - ANSWER-equilibrium
Marginal is a term used to describe the effects of a change in the current situation. Marginal choices always involve the effect of net additions or subtractions from the current condition. In fact, the word additional is often used as a substitute for marginal. - ANSWER-True
A production possibilities curve is a conceptual tool that outlines all possible combinations of total output that could be produced; the slope of the curve indicates the amount of one product that must be given up0 to produce more of the other product. - ANSWER-True
Complements are products that serve similar purposes; an increase in the price of one will cause an increase in demand for the other (hamburgers and tacos, or butter and margarine. - ANSWER-False
Peanut butter and jelly, or hot dogs and hot dog buns are examples of complements, products that are usually consumed jointly; a decrease in the price of one will cause an increase in demand for the other. - ANSWER-True
The invisible hand principle is the tendency of market prices to direct individuals pursuing their own interest to engage in activities promoting the economic well-being of society. - ANSWER-True
Individuals, firms, regions, or nations can gain by specializing in the production of goods that they produce cheaply (at low opportunity cost) and exchanging them for goods they cannot produce cheaply. - ANSWER-Law of Comparative Advantage
A principle that states there is an inverse relationship between the price of a good and the quantity of it buyers are willing to purchase; as price increases, consumers will wish to purchase less. - ANSWER-Law of Demand
A direct relationship between the price of a good and the quantity of it producers are willing to supply; as the price of the good increases, producers will wish to supply more of it. - ANSWER-Law of Supply
An average tax rate is the percentage of income paid in taxes. - ANSWER-True
A progressive tax is a tax in which the average tax rate falls with income, where as a regression tax rate rises with income - ANSWER-False
A proportional tax is a tax in which the average tax rate is different based on income levels. - ANSWER-False
A price controls are government-mandated prices that are generally imposed in the form of maximum or minimum legal prices - ANSWER-True
A price ceiling is the legally established maximum price sellers can charge for a good or resource whereas a price floor is the legally established minimum price buyers must pay for a good or resource (i.e. minimum wage). - ANSWER-True [Show Less]