2.1 Economics Answer Key

Question: Economics

Answer: the study of how resources are converted into products and services and how those products and services are distributed and used

Question: Supply

Answer: the amount of a product or service offered for sale at a given price

Question: Demand

Answer: the amount of a product or service people will buy at a given price if free to do so

Question: Cost-benefit analysis

Answer: a method in which decision-makers compare what will be sacrificed and gained by taking a specific action

Question: Ecological economics

Answer: the field of economics that recognizes the relationships between ecosystems and economic systems

Question: Envionmental economics

Answer: the field of economics that links environmental and economic costs

Question: Non-market value

Answer: the value that is not included in the price of a product or service

Question: Market failure

Answer: a situation in which a free economy, operating on it’s own does not distribute resources fairly

Question: ecolabeling

Answer: a labeling system that tells consumers which brands are made with processes that do not harm the environment

Question: Centrally planned economy

Answer: the government decides what is made, how it is made, and who gets what