CSET Social Science Subtest 3
Economics Questions And Answers
With Verified Solutions 100% Correct!!!
Scarcity and Choice - ANSWER✔✔There will always be a limited number of
resources, which drives the price for most goods. Prices fluctuate when resources
are limited or plenty. It is the buyer's choice to spend the amount of money needed
to buy something. Limited funds limit what people
Opportunity Cost - ANSWER✔✔The benefits that could have happened from
making 1 choice but were put aside to make another choice
Marginal Benefit Equals Marginal Cost - ANSWER✔✔Marginal benefit refers to
what people are willing to give up in order to obtain one more unit of a good, while
marginal cost refers to the value of what is given up in order to produce that
additional unit. It would be inefficient to produce something with less marginal
benefit than the cost to make it, therefore marginal benefit must always equal
marginal cost.
difference between monetary and non-monetary incentives and how changes in
incentives cause changes in behavior - ANSWER✔✔Monetary incentives are
usually cash, whereas non-monetary incentives can be time off work, praise,
positive changes to the work place. Incentivizing a worker can sometimes limit the
workers creativity, doing only what needs to be done so they will get the reward.
Debate the role of private property as an incentive in conserving and improving
scarce resources, including renewable and nonrenewable natural resources. -
ANSWER✔✔Everyone wants property. For some, it is a symbol of wealth, and for
others, it is merely an investment. However, conservation of that specific piece of
property is a lot easier when someone owns it. Without public hands and feet
trampling on its grounds everyday, the land will undoubtedly have a longer life
, span. The private property can also be improved. For example, the owner of the
land might decide to decorate it up, making the look of it a lot prettier
analyze the debate concerning the role of a market economy versus a planned
economy in establishing and preserving political and personal liberty -
ANSWER✔✔In a market economy, individuals answer the three basic economic
questions. The government has no say in what, how, and for whom goods are
produced, and the factors of production are owned by individuals. People can buy,
sell, and produce anything they want. This form of a market preserves political and
personal liberty because the people, not the government, answer the three basic
economic questions. That means the people are free to make their own choices and
have liberty over all of their economic decisions.
Describe and analyze the relationship of the concepts of incentives and substitutes
to the law of supply and demand. - ANSWER✔✔The law of supply states that as
prices get higher, the supply will increase because the producers will want to make
more money on the products. However, the law of demand states that as prices
decrease, demand will increase. Therefore the incentive toward the law of supply is
the high price. As prices get higher, the producer will produce more of the product
in hopes of making a larger profit on the incentive toward the law of demand, is
low prices, because as the prices get lower, demand will increase because
consumers will be able to save money on what they buy. When prices get too
ridiculously soaring, consumers will often resort to a substitute product. For
example, if the price of butter becomes too high, then people will resort to
margarine instead. Therefore, the incentive of substitutes is high price because
consumers will resort to a substitute product if the price of the original is too high.
Discuss the effects of changes in supply and/or demand on the relative scarcity,
price, and quantity of particular products. - ANSWER✔✔If a product is very
scarce, the demand for it will be very high. The reason being is that since there is
so few of the product available, the number of consumers will want itvery badly
because the value of it will be amazingly high. Take for example a diamond. A
diamond is very rare and therefore many rich people are willing to pay hundreds of
thousands of dollars for a small chunk of it. For price, the law of supply states that
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