Study guide: Markets Public Choices and Common Resources
Compare prices, public investment and resource stewardship.
Ideas to explain in your own words
- Demand concerns quantities people are willing and able to purchase at different prices. Quantity demanded concerns one price. A budget affects ability to buy. A purchase record shows an actual transaction. Wanting an item without ability to pay does not establish market demand at every price.
- Supply concerns quantities sellers are willing and able to sell at different prices. Production costs, available inputs and technology can affect it. A shortage of inputs can constrain output. The following fictional cases identify a production feature, not a guaranteed prediction about a real market.
- Public investment uses shared resources for infrastructure or services. A budget can compare initial cost, ongoing maintenance, access and expected use. Choosing one project can defer another. These fictional criteria need evidence, and a proposed benefit is not automatically an observed outcome.
- A shared resource can be affected by several users. Stewardship means caring for its continued use and condition. A rule can limit use; monitoring checks conditions; restoration repairs damage. These fictional examples teach how a resource plan works, not a claim that one policy always succeeds.
Useful vocabulary
- Demand schedule
- quantities buyers are willing and able to buy at different prices
- Quantity demanded
- the quantity willing and able to be purchased at one stated price
- Input availability
- access to materials or other production resources
- Production cost
- resources or money used to produce an item
- Initial cost
- resources required to start or build the project
- Maintenance
- resources needed to keep the project functioning
- Use limit
- a stated restriction on resource use
- Monitoring
- checking and recording the resource’s condition
Watch your reasoning
- Mixing up Demand schedule and Quantity demanded. Re-read what each note says before choosing.
- Adding a detail that is not on the card. Point to the words that help explain your answer.
A worked review example
Worked example: The card says: “Fictional table lists purchases possible at $2, $3 and $4.” That matches Demand schedule. Demand schedule is quantities buyers are willing and able to buy at different prices. Compare the note for Budget constraint: Budget constraint is a limit on money available for purchases. That is a different clue.
Make a practice plan
- Read or listen to the notes in the four lessons. An adult can read aloud.
- Try each lesson’s main question and three practice questions. Say, draw or write what helped you choose.
- Use the review cards, then try the changed card in any lesson you want to practice again.
- Complete the four-box task. Then try the separate subject-test cards.