Suppose after graduating from college you get a job working at a bank earning $30,000 per year. After two years of working at the bank earning

The word "economy" comes from the Greek word oikonomos, which means

"one who manages a household"

The overriding reason why societies and individuals face decisions is that

resources are scarce

Economics deals primarily with the concept of:

scarcity

Scarcity exists when

there is less of a good or resource available than people wish to have

In most societies, resources are allocated by

the combined actions of millions of households and firms

Economists use the word equality to describe a situation in which

each member of society has the same income

The adage, "There is no such thing as a free lunch," is used to illustrate the principle that

people face tradeoffs

Suppose the government taxes the wealthy at a higher rate than it taxes the poor and then develops programs to redistribute the tax revenue from the wealthy to the poor. This redistribution of wealth

is more equal but less efficient for society

When the government implements welfare programs, which of the following is likely to occur?

equity is increased and efficiency is decreased

The opportunity cost of an item is

what you give up to get that item

Suppose after graduating from college you get a job working at a bank earning $30,000 per year. After two years of working at the bank earning the same salary, you have an opportunity to enroll in a one-year graduate program that would require you to quit your job at the bank. Which of the following should not be included in a calculation of your graduate program cost?

the $45,000 salary that you will be able to earn after having completed the program

A marginal change is a

small, incremental change