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Worksheet Key - Limits, Alternatives & Choices

This document contains an economics worksheet that covers several key concepts: 1) It defines and matches terms related to microeconomics, macroeconomics, positive economics, and normative economics. 2) It provides examples of positive and normative economic statements and asks students to generate their own. 3) It identifies economic resources such as land, labor, capital, and entrepreneurial ability. 4) It includes a production possibilities table and questions about opportunity costs related to producing corn and cars. Students are asked to plot the data on a graph and calculate marginal and total opportunity costs.

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731 views4 pages

Worksheet Key - Limits, Alternatives & Choices

This document contains an economics worksheet that covers several key concepts: 1) It defines and matches terms related to microeconomics, macroeconomics, positive economics, and normative economics. 2) It provides examples of positive and normative economic statements and asks students to generate their own. 3) It identifies economic resources such as land, labor, capital, and entrepreneurial ability. 4) It includes a production possibilities table and questions about opportunity costs related to producing corn and cars. Students are asked to plot the data on a graph and calculate marginal and total opportunity costs.

Uploaded by

emongoloide
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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CH_01 WORKSHEET: LIMITS, ALTERNATIVES AND CHOICES

1. Use the appropriate number to match the terms with the phrases below.
1. economics

4. normative economics

2. microeconomics

5. macroeconomics

3. positive economics

6. marginal analysis

a. The attempt to establish scientific statements about economic behavior; a concern with
what is rather than what ought to be.

________

b. Part of economics that involves value judgments about what the economy should be like
or the way the economic world should be. _______
c. Social science that studies how individuals, institutions, and society make optimal
choices under conditions of scarcity.

______

d. Part of economics concerned with the economic behavior of individual units such as
households, firms, and industries (particular markets).

______

e. The comparison of additional benefits and additional costs. ______


f.

Part of economics concerned with the whole economy or its major sectors.

______

2. Following is a list of economic statements. Indicate in the space to the right of each
statement whether it is positive (P) or normative (N). Then, in the last four lines below, write two
of your own examples of positive economic statements and two examples of normative economic
statements.
a. New York City should control the rental price of apartments. ______
b. Consumer prices rose at an annual rate of 4% last year. ______
c. Most people who are unemployed are just too lazy to work. ______
d. Generally, if you lower the price of a product, people will buy more of that product. _____
e. The profits of oil companies are too large and ought to be used to conduct research on
alternative energy sources. _____
f.

Government should do more to help the poor.

g. ___________________________________________

_____
P

h. ___________________________________________

i.

___________________________________________

j.

___________________________________________

3. Following is a list of resources. Indicate in the space to the right of each whether the
resource is land (LD), labor (LR), capital (C), entrepreneurial ability (EA), or some combinations
of these resources.
a. Fishing grounds in the North Atlantic

_____

b. A computer in a retail store

_____

c. Oil shale deposits in Canada

_____

d. An irrigation ditch in Nebraska

_____

e. Bill Gates in his work in starting Microsoft

_____

f.

_____

The oxygen breathed by human beings

g. A McDonalds restaurant in Rochester, Minnesota

_____

h. The shelves of a grocery store

_____

i.

A machine in an auto plant

_____

j.

A person who creates a new Web site and uses it


to start a successful business

_____

k. A carpenter working for a construction company


that is building a house

_____

4. Following is a production possibilities table for two products, corn and cars. The table is
constructed using the usual assumptions. Corn is measured in units of 100,000 bushels and cars
in units of 100,000.

Combination
A
B
C
D
E
F
G
H

Corn

Cars

0
7
13
18
22
25
27
28

7
6
5
4
3
2
1
0

a. Follow the general rules for making graphs (see the appendix to Chapter 1); plot the data
from the table on the graph below to obtain a production possibilities curve. Place corn
on the vertical axis and cars on the horizontal axis.

b. Fill in the following table showing the opportunity cost per unit of producing the 1st
through the 7th car unit in terms of corn units.
Cars

Cost of production

1st

_____

2nd

_____

3rd

_____

4th

_____

5th

_____

6th

_____

7th

_____

c. What is the marginal opportunity cost of the 3rd car unit in terms of units of corn?
___________
d. What is the total opportunity cost of producing 6 car units in terms of units of corn?
___________

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