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CFA LEVEL 1 > Study Session 4: Economics > Flashcards

Study Session 4: Economics Flashcards

1
Q

Distinguish among types of markets.

READING 13. DEMAND AND SUPPLY ANALYSIS: INTRODUCTION

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2
Q

Explain the principles of demand and supply.

READING 13. DEMAND AND SUPPLY ANALYSIS: INTRODUCTION

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3
Q

Describe causes of shifts in and movements along demand and supply curves

READING 13. DEMAND AND SUPPLY ANALYSIS: INTRODUCTION

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4
Q

Describe the process of aggregating demand and supply curves.

READING 13. DEMAND AND SUPPLY ANALYSIS: INTRODUCTION

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5
Q

Describe the concept of equilibrium (partial and general), and mechanisms by which markets achieve equilibrium.

READING 13. DEMAND AND SUPPLY ANALYSIS: INTRODUCTION

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6
Q

Distinguish between stable and unstable equilibria, including price bubbles, and identify instances of such equilibria.

READING 13. DEMAND AND SUPPLY ANALYSIS: INTRODUCTION

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7
Q

Calculate and interpret individual and aggregate demand, and inverse demand and supply functions, and interpret individual and aggregate demand and supply curves.

READING 13. DEMAND AND SUPPLY ANALYSIS: INTRODUCTION

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8
Q

Calculate and interpret the amount of excess demand or excess supply associated with a non-equilibrium price.

READING 13. DEMAND AND SUPPLY ANALYSIS: INTRODUCTION

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9
Q

Describe types of auctions and calculate the winning price(s) of an auction.

READING 13. DEMAND AND SUPPLY ANALYSIS: INTRODUCTION

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10
Q

Calculate and interpret consumer surplus, producer surplus, and total surplus.

READING 13. DEMAND AND SUPPLY ANALYSIS: INTRODUCTION

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11
Q

Describe how government regulation and intervention affect demand and supply.

READING 13. DEMAND AND SUPPLY ANALYSIS: INTRODUCTION

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12
Q

Forecast the effect of the introduction and the removal of a market interference (e.g., a price floor or ceiling) on price and quantity.

READING 13. DEMAND AND SUPPLY ANALYSIS: INTRODUCTION

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13
Q

Calculate and interpret price, income, and cross-price elasticities of demand and describe factors that affect each measure.

READING 13. DEMAND AND SUPPLY ANALYSIS: INTRODUCTION

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14
Q

Describe consumer choice theory and utility theory.

READING 14. DEMAND AND SUPPLY ANALYSIS: CONSUMER DEMAND

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15
Q

Describe the use of indifference curves, opportunity sets, and budget constraints in decision making.

READING 14. DEMAND AND SUPPLY ANALYSIS: CONSUMER DEMAND

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16
Q

Calculate and interpret a budget constraint.

READING 14. DEMAND AND SUPPLY ANALYSIS: CONSUMER DEMAND

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17
Q

Determine a consumer’s equilibrium bundle of goods based on utility analysis.

READING 14. DEMAND AND SUPPLY ANALYSIS: CONSUMER DEMAND

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18
Q

Compare substitution and income effects.

READING 14. DEMAND AND SUPPLY ANALYSIS: CONSUMER DEMAND

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19
Q

Distinguish between normal goods and inferior goods, and explain Giffen goods and Veblen goods in this context.

READING 14. DEMAND AND SUPPLY ANALYSIS: CONSUMER DEMAND

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20
Q

Calculate, interpret, and compare accounting profit, economic profit, normal profit, and economic rent.

READING 15. DEMAND AND SUPPLY ANALYSIS: THE FIRM

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21
Q

Calculate and interpret and compare total, average, and marginal revenue.

READING 15. DEMAND AND SUPPLY ANALYSIS: THE FIRM

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22
Q

Describe a firm’s factors of production.

READING 15. DEMAND AND SUPPLY ANALYSIS: THE FIRM

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23
Q

Calculate and interpret total, average, marginal, fixed, and variable costs.

READING 15. DEMAND AND SUPPLY ANALYSIS: THE FIRM

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24
Q

Determine and describe breakeven and shutdown points of production.

READING 15. DEMAND AND SUPPLY ANALYSIS: THE FIRM

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25
Q

Describe approaches to determining the profit-maximizing level of output.

READING 15. DEMAND AND SUPPLY ANALYSIS: THE FIRM

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26
Q

Describe how economies of scale and diseconomies of scale affect costs.

READING 15. DEMAND AND SUPPLY ANALYSIS: THE FIRM

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27
Q

Distinguish between short-run and long-run profit maximization.

READING 15. DEMAND AND SUPPLY ANALYSIS: THE FIRM

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28
Q

Distinguish among decreasing-cost, constant-cost, and increasing-cost industries and describe the long-run supply of each.

READING 15. DEMAND AND SUPPLY ANALYSIS: THE FIRM

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29
Q

Calculate and interpret total, marginal, and average product of labor.

READING 15. DEMAND AND SUPPLY ANALYSIS: THE FIRM

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30
Q

Describe the phenomenon of diminishing marginal returns and calculate and interpret the profit-maximizing utilization level of an input.

READING 15. DEMAND AND SUPPLY ANALYSIS: THE FIRM

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31
Q

Determine the optimal combination of resources that minimizes cost.

READING 15. DEMAND AND SUPPLY ANALYSIS: THE FIRM

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32
Q

Describe characteristics of perfect competition, monopolistic competition, oligopoly, and pure monopoly;

READING 16. THE FIRM AND MARKET STRUCTURES

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33
Q

Explain relationships between price, marginal revenue, marginal cost, economic profit, and the elasticity of demand under each market structure.

READING 16. THE FIRM AND MARKET STRUCTURES

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34
Q

Describe a firm’s supply function under each market structure.

READING 16. THE FIRM AND MARKET STRUCTURES

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35
Q

Describe and determine the optimal price and output for firms under each market structure.

READING 16. THE FIRM AND MARKET STRUCTURES

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36
Q

Explain factors affecting long-run equilibrium under each market structure.

READING 16. THE FIRM AND MARKET STRUCTURES

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37
Q

Describe pricing strategy under each market structure.

READING 16. THE FIRM AND MARKET STRUCTURES

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38
Q

Describe the use and limitations of concentration measures in identifying market structure.

READING 16. THE FIRM AND MARKET STRUCTURES

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39
Q

Identify the type of market structure within which a firm operates.

READING 16. THE FIRM AND MARKET STRUCTURES

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CFA LEVEL 1 (4 decks)

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