Common Sense

Question 1

Opportunity cost

Answer 1

What do you lose by choosing something else to do

Question 2

Analytical economics

Answer 2

Branch of economic deals with facts and direct observation of the world around us.

Question 3

Analytical economic
Descriptive

Answer 3

Portray things as they are in the present or have been in the past

Question 4

Analytical economic
Conditional

Answer 4

Are forecast based on the careful analysis of economic behaviour
Ex. If this happens this will follow

Question 5

Normative economics

Answer 5

Deals either primarily with value judgements

Question 6

Fallacy of composition

Answer 6

When one believes that what is good for oneself is good for whole

Question 7

The post hoc fallacy

Answer 7

When one believe event A caused by event B because event B came after event A

Question 8

The fallacy of single causation

Answer 8

Refers to when people believe that a single event of person is the only cause of an event or effect

Question 9

Consumer good

Answer 9

Good sold directly to people

Question 10

Capital good

Answer 10

Good used to produce other goods

Question 11

Law of affecting production possibilities

Answer 11

A graph that shows possibility of cost of producing two products

Question 12

Law of increasing relative cost

Answer 12

Refers to loss of other product as result of production of one product

Question 13

Law of diminishing returns

Answer 13

Governs the observation proportional of inputs vs output

Question 14

The law of increasing returns to scale

Answer 14

How increasing more than 1 resource at same time will effect production