Micro Econ

Question 1

Progressive tax

Answer 1

imposes a higher percentage rate of taxation on those with higher income

Question 2

Regressive tax

Answer 2

which imposes a higher percentage rate of taxation on low incomes than on high incomes. For example, if the state sales tax were 5%, the person with the lower income would pay a greater percentage of their total income in sales tax.

Question 3

Proportional tax

Answer 3

imposes the same percentage of taxation on everyone, regardless of income. income tax

Question 4

perfect competition

Answer 4

very many firms
identical products
no barriers to entry
price taker
no nonprice competition
highly efficient
long run: normal profit
agriculture-does not exist

Question 5

monopolistic competition

Answer 5

many firms
differentiated products
few barriers
little price setting power
many nonprice competition
not as efficient as PC
no long run profit

fast food, retail

Question 6

oligopoly

Answer 6

few firms
differentiated
not easy entry
some price setting power
little nonprice competition
not as efficient as PC
yes: long run profit

cars, cereal
COLLUSION

Question 7

monopoly

Answer 7

one firm
one of a kind product
absolute barrier
price setter
some nonprice competition
inefficient
high long run profit

rural gas

Question 8

technical monopoly

Answer 8

patent/copyright

Question 9

natural monopoly

Answer 9

watertreatment facility, public, little money, price regulated by gov

Question 10

government monopoly

Answer 10

gov owned or has a license

post office

Question 11

normal profit

Answer 11

enough to cover all cost

Question 12

econ profit

Answer 12

cover all cost with left over

Question 13

allocative efficiency

Answer 13

producing as much as they can to meet needs of society w/o losing money

Question 14

productive efficency

Answer 14

producing at lowest possible price

Question 15

Perfect competition graph

Answer 15

industry graph: demand supply (price/quantity)
ATC on top of AVC
straight mr

Question 16

profit in pc

Answer 16

profit maximizing point straight down to ATC

Question 17

profit maximizing point

Answer 17

MC= MR

Question 18

long run PC

Answer 18

more ppl go in n supply increase which lowers price/MR

Question 19

MR

Answer 19

largest amt of money you make

Question 20

PC short run econ profit

Answer 20

MR on top of ATC/AVC

Question 21

PC short run loss

Answer 21

MR in the middle

Question 22

PC short run, shut down

Answer 22

touches the bottom one/ AVC

Question 23

PC normal profit

Answer 23

touches top one ATC

Question 24

Fixed cost

Answer 24

doesnt change w/ amt of output, space btw ATC n AVC

rent

Question 25

total cost

Answer 25

fixed + variable cost

Question 26

marginal cost

Answer 26

cost of producing one more unit

Question 27

PC econ profit to long run

Answer 27

industry graph | increase in supply

Question 28

PC normal to loss

Answer 28

industry graph decrease in supply

Question 29

Monopoly

Answer 29

ATC below alllocatively efficient point proft max straight up to demand= unregulated price/quantuy profit: Atc to demand

Question 30

Monopoly | allocatively efficient point

Answer 30

MC= D

Question 31

imperfect competitor

Answer 31

price is always lower than mr

Question 32

profit

Answer 32

Revenue-cost

Question 33

deadweight Monopoly

Answer 33

triangle next to profit loss to society increase deadweight= decrease surplus

Question 34

Consumer surplus

Answer 34

triangle top of profit ppl expect to pay more but the price is actually lower consumer+ producer= total surplus

Question 35

Monopoly highest of point of total revenue

Answer 35

MR=0 Max total rev: straight up to Demand

Question 36

inelastic Monopoly

Answer 36

price decrease total revenue decrease right

Question 37

elastic Monopoly

Answer 37

decrease price, total revenueincrease left

Question 38

Monopoly supply curve

Answer 38

on MC, above ATC

Question 39

single price monopolist

Answer 39

change price for spec condition | like movie/plane tickets

Question 40

monopolistic competition | long run

Answer 40

profit maximizing point up to demand. ATC touches | normal profit

Question 41

monopolistic competition short run

Answer 41

same as monopoly profit: D to atc

Question 42

monopolistic competition lost

Answer 42

ATC abov demand

Question 43

Extranality

Answer 43

something that affects a person that has nothing to do w/ making the product or using it. cost that firm pays is external, not on balance sheet

Question 44

sole proprietorship

Answer 44

``` one person owns it most common limited life unlimited liability difficult to raise money ```

Question 45

patnership

Answer 45

``` more than one owner accounting, lawyer, doctor least common unlimited liability limited life easier to raise money than propri ```

Question 46

coporation

Answer 46

``` raise money by selling stocks unlimted life limited liability owners have little control double taxation (coportate n personal income) dividend: periodic paycheck ```

Question 47

public goods

Answer 47

paid for by tax nonexcludable (nothing prevents usage nonrival (everyone can use at the smae time)

Question 48

common goods

Answer 48

nonexcludable rivals (fish/water source

Question 49

total revenue- monopoly

Answer 49

profit rectanle extended down

Question 50

negative externalities

Answer 50

cost push P/Q graph D= marginal profit S= marginal cost decrease in supply

Question 51

postive externailities

Answer 51

demand pull | D= marginal benefits