Unit 1 Guided Notes/ Study Guide for Economics 412

Answer these questions while reading through the course or

attending class connect sessions. At the end of the unit, upload
the completed assignment to the dropbox.
Saving your TGA: Last Name, First Name Initial Student ID#_Unit 1 Study Guide
Example: Smith, J 1234567_Unit 1 Study Guide

Topics Covered:
The Purposes and Origins of Government
Power and Government
Types of Government

(25 points)

1. Explain the role of scarcity in economics.

Humans have an undeniable desire of wants. The availability
of resources can never be enough to satisfy the needs of
everyone. Economic goods are said to be scarce in supply,
that they cannot meet the demands of humans all at once.
2. Describe the four fundamental questions faced by all
economic systems.
1. What is to be produced?
Goods and services are what needs to be produced.
2. How is production to be organized?
3. How are goods and services to be distributed?
4. What is the most effective allocation of resources?

3. How is Economics like a game? Who are the players in the

game of Economics?

Define these different economic goals

4. Efficiency
refers to the use of resources in a manner that gets
as much out of them as possible. Efficiency is a goal
producers have, to provide more goods and services
for society without using more resources.
5. Equity
Equity means fairness; It is the notion that everyone
should be treated equally.
6. Freedom
Freedom in economics is defined as the absence of an
obstacle or constraint.
7. growth
means increasing the size, number, or output of
goods or services. It makes sense to want growth,
because in the economy, growth means more goods,
more jobs, and more money.
8. Security
is protection against risk or danger. Because life is
uncertain and bad things can happen, the economic
goal of security encourages us to lessen the dangers
we face.

9. What is the difference between a rule and a property? Name

a rule and a property that apply to economics.

10.
Explain a situation where two specific economic goals
could be incompatible.

11.

Explain the concept of supply and demand.

12.
Why is the concept of supply and demand not included
in the four fundamental questions faced by all economic
systems?

13.
What is the importance of competition in a free-market
system?

14.
How does the profit motive affect the goals of
producers?

15.
What are the main advantages of living in a command
economy?

16.
Consumers, Producers, Wages: Explain their relation to
one another.

Define cost benefit analysis and how cost-benefit

analysis is used to make rational decisions.

17.

18.

Define these Economic Indicators:

GDP

19.

CPI

20.

Inflation

21.

Unemployment

 How does the CPI help calculate the inflation rate of a

country?

What is happening to the GDP of a country if the economy is

stagnating?

22.
Define:
Mixed Economy

Free Market

Command Economy

23.

24.

Define E-commerce

Explain how technology affects economics.

25.
How does increased productivity lead to lower prices for
consumers?

26.
How can technological advancements create a ripple
effect?

27.

How do consumers benefit from e-commerce?