Help
Options
Didn't know it?
click below
click below
Knew it?
click below
click below
Don't Know
Remaining cards (0)
Know
retry
shuffle
restart
0:00
Embed Code - If you would like this activity on your web page, copy the script below and paste it into your web page.
Normal Size Small Size show me how
Normal Size Small Size show me how
ECO 2314 Exam 1
Texas State / Fall '10 / McClung
| Question | Answer |
|---|---|
| ECONOMICS | HOW ECO AGENTS (CONSUMERS) MAKE CHOICES UNDER CONDITIONS OF SCARCITY, AND THE RESULTS OF THOSE CHOICES. |
| SCARCITY PRINCIPAL | ECO AGENTS HAVE UNLTD WANTS, BUT ONLY LTD RESOURCES TO FULFILL THEM. |
| COST-BENEFIT PRINCIPAL | ECO AGENTS SHOULD TAKE AN ACTION IF EXTRA BENEFITS OF THE ACTION ARE GREATER THAN OR = TO THE EXTRA COST OF THE ACTION. |
| RATIONAL PERSON | SOMEONE W. WELL DEFINED GOALS WHO SEEKS TO ACHIEVE THEM. |
| ECONOMIC SURPLUS | TOTAL BENEFITS - TOTAL COST = NET BENEFIT. [ONLY TAKE ACTION IF ECO SURPLUS IS GREATER THAN OR = TO 0.] |
| THE FOREGONE ALTERNATIVE | THE NEXT HIGHEST VALUED ALTERNATIVE NOT SELECTED, E.G. SLEEPING. |
| 3 COMMON ERRORS OF DECISION MAKING | 1) MEASURING COST BENEFITS AT % RATHER THAN ABSOLUTE AMOUNTS. 2)FAILURE TO INCLUDE OPP. COSTS, 3) FAILURE TO THINK @ THE MARGIN. |
| MEASURING COST BENEFITS AS % RATHER THAN ABSOLUTE AMOUNTS | ONE OF THE THREE COMMON ERRORS OF DECISION MAKING. INCONVENIENCES AND INCIDENTALS (COST) CANNOT BE CALCULATED AS PERCENTAGES. |
| ECONOMIC SURPLUS | TOTAL BENEFIT - TOTAL COST - OPPORTUNITY COST |
| FAILURE TO THINK AT THE MARGIN | |
| SUNK COSTS | ANY COST THAT IS UNRECOVERABLE AT THE TIME THE DECISION IS MADE. |
| AVERAGE BENEFITS | ...OF ANY PARTICULAR ACTION = TOTAL BENEFITS/# UNITS |
| MARGINAL BENEFIT | __ TOTAL BENEFITS / __ # UNITS |
| MARGINAL COSTS | __ TOTAL COSTS / __ # UNITS |
Created by:
goldmeg89
Popular Business sets