1. Economists are fond of saying that there is no free lunch. What concept supports this belief?
2. Name two opportunity costs that may not show up on the income statement of a business?
3. What is the Production Possibilities Curve?
4. How does a society produce at an output level on the PPC?
5. Using the marginal principle, at what level should an activity be undertaken to?
6. For both parties of an exchange to be better off what two conditions must exist?
7. What is the principle of diminishing returns?
8. When would the diminishing return principle not apply?
9. What is inflation?
10. What is the real-nominal principle?
11. How might the real-nominal principle influence your decision to either rent a house for $500 a month or purchase a similar house with a resulting $550 a month house payment for a 30 year fixed rate interest load?
12. Explain the difference in movement along the line of a graph and a shift of the line of a graph.
13. What is the formula for a percentage change of a value (Initial value method)?
14. If the initial value was 50 and the new value is 56, what is the percentage change? (Initial value method)