Economics Unit 1 Review

Unlimited wants + limited resources =

• Utility

• Scarcity

• Paradox of value

• Opportunity cost

The acronym TINSTAAFL reflects the idea that:

• some things are more valuable than others

• all products require some form of labor

• market economies are the most free

• nothing is free

This picture shows the concept of:

• Opportunity cost

• Diminishing marginal utility

• Paradox of value

• Tragedy of the commons

A factory decides to produce 50 less cars to produce 25 more boats. The value of the next best alternative given up (50 cars) is called:

• Marginal Benefit

• Paradox of value

• Factors of production

• Opportunity cost

In economics, utility is:

• the degree to which a product can be useful and provide satisfaction

• the ability of a product to be used by many different people

• the key characteristic of all command economies

• the amount of resources required to make a product

Workers in a factory, for example.

• Land

• Capital

• Labor

• Entrepreneur

Machines in a factory, for example.

• Land

• Capital

• Labor

• Entrepreneur

Natural minerals needed to make a product, for example.

• Land

• Capital

• Labor

• Entrepreneur

Walt Disney, for example.

• Land

• Capital

• Labor

• Entrepreneur

North Korea has this type of economy

• Market

• Open

• Command

• Traditional