microexam 1 Flashcards

1
Q

Economics is the study of

A

choices

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2
Q

econmoics is the social science concerned with how individuals,
institutions, and society make optimal choices under
conditions of

A

scarcity

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3
Q

the condition whereby the resources we use to produce
goods and services are limited relative to our wants for
them

A

scarcity

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4
Q

signal that tells producers what and how much to
produce; in a standard market transaction it is paid by the
consumer

A

price

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5
Q

the sacrifice associated with making a choice; in
a standard market transaction it is paid by the producer

A

cost

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6
Q

out-of-pocket, monetary payments

A

explicit cost

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7
Q

most valued option forgone

A

opportunity/implicit cost

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8
Q

types of resrouces

A

labor, capital, entrepreneurship, natural

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9
Q

We try to maximize our ______by using by using _______ decision
making

A

utility, marginal

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10
Q

the satisfaction a consumer obtains from the
consumption of a good or service consumption of a good or service

A

utility

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11
Q

additional; the change that results from an
additional unit

A

marginal

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12
Q

statements about economic behavior or the economy that enable prediction of the probable effects of or the economy that enable prediction of the probable effects of certain actions

A

economic principles

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13
Q

In ______markets, households markets, households demand goods and services goods and services
which are which are supplied by firms in exchange for money

A

product

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14
Q

in ______markets, firms markets, firms demand resources which are resources which are supplied
by households in exchange for money

A

resouce

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15
Q

the price of a good and the quantity demanded price of a good and the quantity demanded
are inversely related

A

law of demand

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16
Q

the number of units consumers are of units consumers are
willing to buy at a willing to buy at a specific price

A

quantity demanded

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17
Q

In QD, a change in the amount purchased caused by a change in price results

A

in a movement ALONG the curve

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18
Q

What shifts the demand curve

A

income, price of related goods, expectations of future prices, number of buyers , taste and preferences

19
Q

How does income and demand move for a normal good

20
Q

How do income and demand move for a inferior good

21
Q

How does the price of one good and demand for another move for substitutes

22
Q

How does the price of one good and demand for another move for complements

23
Q

How does the expectations of future prices and demand move

24
Q

The more number of buyers

A

higher the demand

25
the price of a good and the quantity supplied are directly (positively) related
law of supply
26
the number of units producers are of units producers are willing to offer for sale at specific price
quanity supplied
27
change in the amount offered for sale caused by a change in the price
shift along the supply curve
28
How do input prices and supply move
together
29
When technology improves
supply increases
30
Taxation and supply move
opposite
31
expectations of future prices and supply move
opposite
32
no tendency for change
equalibirum
33
the allocation of goods among consumers using prices
price rationing
34
economists believe that _______is the most efficient method of allocating goods and services
price rationing
35
every consumer willing to pay at least the equilibrium price will get to have the good
price rationing
36
With other rationing methods besides price , the allocation is
random
37
a measure of the relative responsiveness of one variable to a change in another
elasticity
38
a tiny change in P causes an infinite change in Qd Price Quantity DP EXAMPLE: Agricultural marketsE
perfect elastibility
39
ED = infinity
perfectly elastic
40
Ed>1, flat graph
elastic
41
ED= 1
unit elasticity
42
ED< 1 steep
inelastic
43
ED=0, price change has no affect of QD
perfect inelastically