Question: The disagreement among economists typically revolves around

Answer: normative economics

Question: If economists examine the relationship between the price of a good and sales of that good while ignoring other related factors, or assuming those other factors are equal, they are using which of the following?

Answer: ceteris paribus

Question: Which discipline studies the decision-making process of customers, workers, households, and business firms on an individual basis rather than as aggregates?

Answer: Microeconomics

Question: Economic principles are generalized statements that ______ consumer behavior.

Answer: look at typical

Question: What is the focus of positive economics?

Answer: Cause-and-effect relationships and Facts

Question: The ____ problem refers to the need to make choices because economic wants exceed economic means.

Answer: economizing

Question: As a result of our ______ incomes and ______ wants, it is in our self-interest to economize or pick and choose goods and services that maximize our satisfaction.

Answer: limited; insatiable

Question: ______ economic resources means limited goods and services.

Answer: scarce

Question: What do combinations of output that fall inside the production possibilities curve represent?

Answer: goods that are attainable and less total outcome than points on the curve

Question: What is the cause of a society's increasing opportunity costs with respect to the production of goods?

Answer: Resources that are not fully interchangeable

Question: The assumption behind purposeful behavior is that ______.

Answer: people act in such a way as to rationally pursue their own interests

Question: When people get satisfaction from charitable giving, they are ______.

Answer: acting out of rational self-interest

Question: Because consumers behave in a rationally self-interested manner, the consumer will purchase a good or service ______.

Answer: when the marginal benefit is greater than the marginal cost

Question: Economic principles are generalizations that are ______.

Answer: expressed as the tendencies of average consumers, workers or firms

Question: In a world of scarcity, ______.

Answer: the decision to obtain the marginal benefit (MB) of a specific option always includes the marginal cost (MC) of forgoing something else

Question: A statement about economic behavior or the economy that enables prediction of the probable effects of certain actions is known as a(n) ______.

Answer: economic principle

Question: _____is the discipline that examines the performance and behavior of an economy as a whole.

Answer: Macroeconomics

Question: When economists consider the output of all U.S. businesses as a single entity, they are treating them as a(n) ______.

Answer: aggregate

Question: True or false: Positive economics encourages value judgments.

Answer: FALSE

Question: Normative economics is ______.

Answer: Based on value judgments

Question: True or false: Everyone except for the super wealthy has a finite, or limited, amount of income.

Answer: FALSE

Question: For better or worse, people have ______.

Answer: virtually unlimited wants

Question: Which of the following describes a budget line?

Answer: A curve showing various combinations of two products a consumer can purchase with a specific amount of income.

Question: What does every point on a budget line graph represent?

Answer: All combinations of goods that can be purchased with a given income

Question: Which of the following combinations are unattainable given a consumer's budget line?

Answer: Combinations that fall beyond the budget line

Question: True or false: A decrease in income will shift the budget line to the left.

Answer: TRUE

Question: _____ lists the different combinations of two products that can be produced with a specific set of resources, assuming full employment

Answer: Production Possibilities Table

Question: Points lying ______ the production possibilities curve represent greater, but unachievable levels of output with current inputs, than that at any point on the curve.

Answer: outside

Question: Positive economics ______ value judgments, tries to establish ______ statements about economic behavior, and deals with ______ economic events.

Answer: avoids; scientific; actual

Question: What best describes the combination of goods that lie on the production possibilities curve?

Answer: they are attainable; they utilize the economy's available resources

Question: An increase in income will ______.

Answer: shift the budget line to the right

Question: Which of the following are ways of expressing the meaning of ceteris paribus?

Answer: Assuming other things remain constant and Assuming factors other than those being considered in a particular analysis do not change

Question: A consumer's ____ line or constraint shows various combinations of two products that can be purchased with a specific amount of income.

Answer: budget

Question: Which of the following are issues most explored in microeconomics?

Answer: Measuring the price of specific goods, the expenditures of a government entity, measuring total revenues of a firm

Question: The straight-line budget constraint indicates ______ opportunity cost.

Answer: constant

Question: Trade-offs arising from limited resources give rise to ______.

Answer: opportunity costs

Question: Consumers must make choices about what to buy and what to forgo to fulfill wants because ______.

Answer: consumers' incomes are limited

Question: A production possibilities curve (PPC) illustrates the attainable combination ______,

Answer: of two goods that can be produced given a specific set of resources

Question: A production possibilities curve with an increasing slope is the result of which of the following?

Answer: The law of increasing opportunity costs

Question: When an economy produces a good such that the marginal benefit equals the marginal cost, this indicates that ______.

Answer: resources are being allocated efficiently

Question: Points lying ______ the production possibilities curve are attainable but reflect less total output than can be produced.

Answer: inside

Question: Which of the following is true of positive economics?

Answer: It avoids value judgments, tries to establish scientific statements about economic behavior, focuses on facts and cause-and-effect relationships.