Intro to Econ

Economics can be defined as ________________.

• the science of decision making

• the science of buying and selling

• the study of human behavior

• the study of unlimited resources

Scarcity is the economic law that needs and wants are ________________ but resources are ________________.

• unlimited / limited

• limited / unlimited

• costs / benefits

• benefits / costs

Good economic decisions are made when the benefits of a choice are greater than the

• costs

• needs

• wants

• community

Which of these things is a "need" and not a "want"?

• shoes to keep your feet warm & protected

• a really nice house/apartment to live in

• going to an elite college or prep school

• a smartphone with data/internet access

Explain the economic concept of "There is No Such Thing As a Free Lunch"

• Mr. Hogan isn't buying you lunch!

• You should really just wait for dinner

• Did you not eat breakfast?

• Everything has a cost

What is Economics? Check all that apply

• 18 year old decide to work or go to college

• Businesses deciding what to make/produce

• Government deciding to increase spending during a pandemic

• Study of money

Which of the following is a characteristic of a scarce resource?

• Scarce resources must be expensive

• Scarce resources must be unlimited in quantity

• Scarce resources must have only one use

• Scarce resources must be desirable

Opportunity Cost is best defined as

• the value of the next best alternative that is given up due to the choice you made

• The price you pay to purchase something

• The amount of debt you take on by making a decision

• The benefit you gain by making a decision

The Hogan family has saved some money. They can spend it on a vacation to the Grand Canyon or build a swimming pool in their back yard. They decide to spend the money on a trip to Grand Canyon. What is the opportunity cost of their decision?

• Vacation

• Swimming Pool

You decide to start a small business mowing your neighbor's lawns. You have $200 to get started. You are deciding whether you should spend some of the money on advertising or buying a higher quality machine. What will be a better investment? Which principle are you using?

• Economics

• Incentives matter

• Scarcity

• Tradeoffs (thinking at the margin)