Question: explain the difference between a want and a need

Answer: a want is not necessary for survival and a need is necessary for survival

Question: what is the difference between a good and a service? what kind of goods are available? what are some kinds of service?

Answer: a good is a useful, tangible item that can fulfill a want or need. A service is a work that is performed for someone to fulfill a want or need, but it is not tangible. Goods include cars, MP3 players, food, and medicine. Services include haircuts, home repairs, and concerts.

Question: what determines the monetary value of a good or service? why are some necessities less expensive than unnecessary items?

Answer: Scarcity and utility determine monetary value. Some necessities are useful but plentiful, so they may cost less than unnecessary goods and services that are very scarce and have utility.

Question: list the four characteristics of the accumulated goods that make up economic wealth.

Answer: Tangibility, scarceness, utility, and transferability

Question: is anything actually “free”? why or why not?

Answer: Almost nothing is free, because someone must pay for it in the first place.

Question: who makes the decisions about WHAT goods to produce in North Korea? Who decides in the United States? How can the decisions affect the people living in those societies?

Answer: In North Korea, the government decides what to produce, and in the United States, consumers decide. Because of this, in North Korea large amounts of military goods are produced instead of consumer goods. In the United States, what is produced more closely matches what consumers want and need.

Question: what factors go into making a decision about HOW to produce the goods? Explain why Japanese producers rely heavily on robots

Answer: Available resources help determine how to produce goods. Because the Japanese population is relatively old, they rely on robots more than on people for production.

Question: why must societies decide FOR WHOM to produce?

Answer: There are many different groups that need or want a limited supply of goods.

Question: what is gross domestic product and how is it a description of economic activity?

Answer: GDP is the monetary value of all final goods, services, and structures produced within a country’s borders.

Question: how can explanation make it easier to address economic problems in the future?

Answer: Explanation gives us a common understanding of the way our economy works, so we can work together more easily.