Microeconomics: Supply and Demand and Price

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CHAPTER 1: Resource Utilization & Economics Part I: Identification Directions: Fill in the blanks. ____________________ 1. Refers to the scarce resources in demand. ____________________ 2. Considered the father of economics. ____________________ 3. The Greek word for economics. ____________________ 4. Developed the theory of political economy. ____________________ 5. Considered as the bible of economics. ____________________ 6. Developed the concept of IS-LM model. ____________________ 7. Refers to economics “as it is”. ____________________ 8. Science that manages limited resources in demand. ____________________ 9. Developed the theory of money, employment and interest. ____________________ 10. Refers to economics “as it should be”.…show more content…
Part III: Definition of Terms. 1. Economics – the efficient allocation of the scarce means of production toward the satisfaction of human needs and wants. 2. Microeconomics – the branch of economics, which deals with the individual decisions of units of the economy – firms and households, and how their choice determine relative prices of goods and factors or production. 3. Macroeconomics – the branch of economics that studies the relationship among broad economic aggregates like national income, national output, money supply, bank deposits, total volumes of savings, investment, consumption expenditure, general price level of commodities, government spending, inflation, recession, employment, and money supply. 4. Capitalism – economic system that is based on private ownership of the means of production and the creation of goods and services for profit. 5. Communism – a revolutionary socialist movement to create classless, money less, and stateless social order structured upon common ownership of the means of production as well as social, political and economics ideology. 6. Mixed Economy – economy that applies a mixture of three forms of decision-making. 7. Equity – justice and fairness. 8. Land – refers to all natural resources, which are given by, and found in nature, and are, therefore, not manmade. 9. Production – the problem of production is generally a concern of producers. They determine the needs, wants, and demands of

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