Term
| What is the best definition of economics? |
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Definition
| The study of how individuals and societies choose to use the scarce resources that nature and previous generations have provided |
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Term
Which of the following statements is correct
A) economics is a behavioral science
B) in large measure, economics is the study of how people make choices
C) if poverty were emanated there would be no reason to study economics.
D) economic analysis can be used to explain how both individuals and societies make decisions. |
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Definition
| If poverty were eliminated the would be no reason to study economics. |
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Term
| What are some reasons to study economics? |
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Definition
to understand society
to understand global affairs
to be an informed voter |
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Term
| The concept of opportunity cost |
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Definition
| Suggests a major increase in public health care spending means an expansion in other areas will be harder to achieve |
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Term
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Definition
| Costs that cannot be avoided, because they have already been incurred. |
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Term
| You purchased a ticket to a concert for $30 a month ago. Last week someone invited you to a party on the dance night as the concert. You have tried unsuccessfully to seek the concert ticket. |
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Definition
| The $30 you spent on the concert should be irrelevant in decision making because it is a sunk cost |
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Term
| You decide that for Halloween you wanted to dress up as batman. You estimated that it would cost $25 to purchase all the pieces of the costume. After spending $20 on the costume you realize that the additional pieces you need will cost you $15 more. The marginal cost of completing the costume is... |
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Definition
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Term
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Definition
| That which we forgo, or give up, when we make a choice or a decision |
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Term
| The reason that opportunity cost arise is that. |
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Definition
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Term
Which of the following is not an opportunity cost of surveying college.
A) tuition
b) potential income of you didn't Steve college
c) alternative uses of the time you spend studying
D) cost of food you consume while you are attending college |
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Definition
| The cost of food you cosine while attending college |
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Term
| If you own a building and you decide to use it to open a restaurant. |
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Definition
| There is an opportunity cost of using this building for a restaurant because it cod have been used in other ways |
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Term
| Costs that cannot be avoided, regardless of what is done in the future, because they have already been incurred are |
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Definition
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Term
| Macro economics is the branch of economics that examines |
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Definition
| The economic behavior of aggregates- income, employment, and output - on a national scale |
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Term
| Normative economics is an approach to economics that |
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Definition
| Analyses outcome of economic behavior, evaluate them as good or bad, and may prescribe preferred courses of action. |
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Term
Which of the following is an example of a positive statement
A) the federal government should be required to have a balanced budget
B) local government ought to impose rent controls to allow people to afford housing
C) studies indicate that the imposition of a minimum wage increases unemployment.
D) the government should impose taxes on imported goods to protect the jobs of American workers |
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Definition
| studies indicate that the imposition of a minimum wage increases unemployment. |
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Term
which of the following is a normative question
A) why do gasoline prices increase before holiday weekends?
B) what will happen to gasoline consumption if excise taxes on gasoline are increased?
C) to reduce the regressivity of the gasoline excise tax, should a portion of the gasoline escise tax paid by low-income individuals be refunded to them?
D) how will oil exploration be affected if the government imposes price controls |
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Definition
| To reduce the regressivity of the gasoline excise tax, should a portion of the gasoline excise tax paid by low income individuals be refunded to them? |
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Term
| the process by which resources are transformed into useful forms is |
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Definition
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Term
which of the following is not a resource as the term is used by economists?
A)land
B)labor
C)buildings
D)money |
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Definition
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Term
which of the following would an economist classify as capital?
A) a deposite of silver
B) a share of stock
C) a public corporation's employees
D) an automobile leased by an individual |
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Definition
| an automobile leased by an individual |
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Term
| capital, as economists use the term |
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Definition
| refers to things that have already been produced that are in turn used to produce other goods and services. |
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Term
| the concept of opportunity cost is based upon the principle of |
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Definition
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Term
which of the following does NOT constitute an act of "investment" as economists use the term?
A)the city park commission authorizes the construction of a new swimming pool.
B) an individual buys 100 shares of stock at $30 a share then sells the stock at a profit for $35 a share.
C) a corporate lawyer attends a seminar on changes in the federal tax code.
D) a grocery store increases its inventory of potato chips and soda before the memorial day weekend. |
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Definition
| an individual buys 100 shares of stock at $30 a share and then sells the stock at a profit for $35 a share. |
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Term
| A graph showing all the combinations of goods and services that can be produced if all of society's resources are used efficiently is the |
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Definition
| production possibility frontier. |
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Term
[image]
a point like point B represents a situation of?
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Definition
| both full resource employment and production efficiency. |
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Term
[image]
Microland is currently operating at point B. You correctly decude that . |
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Definition
| in Microland all resources are fully employed an there are no production inefficiencies. |
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Term
| The production possibility frontier is a graph that shows. |
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Definition
| all the combinations of goods and services that can be produced if all of society's resources are used efficiently. |
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Term
| If the unemployment rate increases from 10% to 12%, the economy will.. |
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Definition
| move farther away from the production possibility frontier. |
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Term
| an economy that is producing at the wrong point on its production possibility frontier is |
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Definition
| inefficient, since that combination of goods could be produced at a lower cost if more efficient technology were employed. |
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Term
| the value of the slope of a society's production possibility frontier is called its |
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Definition
| marginal rate of transformation |
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Term
| assume a society can produce either beef or chicken. if the marginal rate of transformation of beef into chick is -.5, then the opportunity cost of chicken is.. |
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Definition
| the .5 units of beef that must be forgone |
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Term
| the marginal rate of transformation is the |
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Definition
| slope of the production possibility frontier. |
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Term
| if the opportunity costs of producing a good increase as more of that good is produced, the economy's production possibility frontier will be |
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Definition
| negatively sloped and "bowed outward" from the origin. |
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Term
| Economic growth may occur when |
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Definition
| a society acquires new resources and a society learns to produce more using existing resources. |
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Term
| What is held constant along the demand curve? |
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Definition
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Term
which of the following will NOT cause a shift in the demand curve for compact discs?
A) a change in income
B)a change in wealth
C)a change in the price of prerecorded cassette tapes
D)a change in the price of compact discs. |
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Definition
| a change in the price of compact discs. |
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Term
| The "law of demand" implies that |
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Definition
| as prices rise, quantity demanded increases. |
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Term
| according to the law of demand: As prices rise, ceteris paribus |
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Definition
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Term
| as an individual consumes more of a product within a given period of time, it is likely that each additional unit consumed will yield |
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Definition
| successively less satisfaction. |
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Term
| when the price of a good falls and you buy the same quantity of that good, you have money left over and are better able to afford more of all goods. this is the... |
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Definition
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Term
| the price of hamburgers drops suddenly and you disorder that you and your friends eat more hamburgers. this is due to the |
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Definition
| income and substitution effects. |
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Term
[image]
which of the following would be most likely to cause the demand for dr. pepper to shift from D0 to D1?
A) a decrease in income, assuming that Dr. Pepper is a normal good.
B) an increse in the price of 7-up, assuming 7-up is a substitute for Dr. Pepper
C) a decrease in the price of Dr. Pepper
D) a reduction in the price of sugar used to make Dr. Pepper |
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Definition
| a decrease in income, assuming that Dr. Pepper is a normal good. |
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Term
| the Setrite Corporation produces chairs. An economist working for the firm predicts that "if people's incomes rise next year, then the demand for our chairs will increase, ceteris paribus." The accuracy of the economist's prediction depends on whether the chairs Setrite produces.. |
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Definition
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Term
| if the demand for coffee decreases as income decreases, coffee is... |
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Definition
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Term
| suppose the demand for good Z goes up when the price of good Y goes down. We can say that goods Z and Y are. |
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Definition
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Term
| During an economic downturn when consumer income falls, the demand for ice cream increases and the demand for chocolate cake decreases. this implies that. |
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Definition
| ice cream is an inferior good and chocolate cake is a normal good. |
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Term
| in college you practically existed on tuna fish, but now that you have a $45,000 a year job, you never want to see tuna fish again. we can safely conclude that you consider tuna fish to be |
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Definition
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Term
| in response to news reports taht taking aspirins daily can reduce an individual's risk of a heart attack, there will most likely be |
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Definition
| an increase in the demand for aspirins. |
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Term
| Demand curves are derived while holding constant. |
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Definition
| income, tastes, and the price of other goods. |
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Term
| the quantity demanded of Pepsi has decreased. the best explanation for this is that |
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Definition
| the price of Pepsi has increased. |
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Term
| a change in the price of a good or service leads to a ______ which leads to a ______. |
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Definition
| Change in quantity demanded; movement along the demand curve. |
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Term
[image]
Assume the market is initially at point B and that pizza is a normal good. A decrease in income would cause the market to move from point B on demand curve D2 to .. |
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Definition
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Term
[image]
if pizza and beer are complements, a decreae in the price of beer will cause a movement from point B on demand curve D2 to .. |
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Definition
| Point C on demand curve D2. |
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Term
[image]
if pizza and hamburgers are substitutes, an increase in the price of hamburgers will cause a movement from point B on demand curve D2 to .. |
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Definition
| point C on demand curve D2 |
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Term
Which of the following is consistent with the law of supply?
A) as the price of calculators rises, the supply of calculators increases, ceteris paribus.
B)as the price of calculators falls, the supply of calculators increases, ceteris paribus.
C) as the price of calculators rises, the quantity supplied of calculators increases, ceteris paribus
D)as the price of calculators rises, the quantity supplied of calculators decreases, ceteris paribus. |
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Definition
| B)As the price of calculators falls, the supply of calculators increases, ceteris paribus. |
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Term
[image]
in the rollerblade market, you accurately predict that. |
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Definition
| price will increase, the quantity demanded will fall, and the quantity supplied will rise. |
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Term
[image]
if this market is unregulated and the price is currently $40, you would expect that.. |
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Definition
| the price would fall to $30, where quantity demanded equals quantity supplied. |
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Term
[image]
at a price of $40, there is an |
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Definition
| excess supply of 75 blue jeans. |
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Term
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Definition
| the dollars sacrificed- and actually paid out for a choice |
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Term
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Definition
| the value of something sacrificed when no direct payment is made |
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Term
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Definition
| what is given up when taking an action or making a choice |
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Term
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Definition
| a situation in which more of at least one good can be produced without sacrificing the production of any other good. |
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Term
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Definition
| the ability to produce a good or service, using fewer resources than other producers use |
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Term
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Definition
| the ability to produce a good or service at lower opportunity cost than other producers. |
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Term
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Definition
| an economy in which resources are allocated according to long-lived practices from the past. |
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Term
| command or centrally planned economy |
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Definition
| an economic system in which resources are allocated according to explicit introductions from a central authority |
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Term
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Definition
| an economic system in which resources are allocated through individual decision making |
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Term
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Definition
| a type of economic system in which most resources are owned by the state |
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Term
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Definition
| a type of economic system in which most resources are owned privately |
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Term
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Definition
| a type of economic system in which most resources are owned in common |
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Term
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Definition
| as the price of a good increases, the quantity demanded decreases. |
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Term
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Definition
| the specific amount of a good that all buyers in the market would choose to buy over some time period, given a particular price and all other constraints they face. |
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Term
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Definition
| the graphical depiction of a demand schedule; a curve showing the quantity of a good or service demanded at various prices, with all other variables held constant. |
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Term
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Definition
| a good that people demand more of as their income rises. |
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Term
| change in quantity demanded |
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Definition
| a movement along a demand curve in response to a change in price |
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Term
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Definition
| a shift of a demand curve in response to a change in some variable other than price |
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Term
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Definition
| a good that people demand less of as their income rises. |
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Term
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Definition
| the total value of everything a person or firm owns, at a point in time, minus the total value of everything owned. |
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Term
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Definition
| a good that can be used in place of some other good and that fulfills more or less the same purpose. |
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Term
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Definition
| a good that is used together with some other good. |
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Term
| a change in price represents what in a demand curve |
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Definition
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Term
| increase in wealth, price of substitute, price of complement, population, expected price or taste does what to a demand curve. |
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Definition
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Term
| decrease in wealth, price of substitute, price of complement, population, expected price or taste does what to a demand curve. |
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Definition
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Term
| types of economic systems grid |
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Definition
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Term
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Definition
| the specific amount of a good that ll sellers in the market would choose to sell over some time period, given a particular price for the good and all other constraints on firms. |
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Term
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Definition
| as the price of a good increases, the quantity supplied increases |
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Term
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Definition
| a graphical depiction of a supply schedule; a curve showing the quantity of a good or service supplied at various prices, with all other variables held constant. |
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Term
| what happens to supply curve with change of price |
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Definition
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Term
| what happens to supply curve when decrease in price of input, price of alternate, expected price, technological advance, favorable weather |
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Definition
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Term
| what happens to supply curve when increase in price of input, price of alternate, expected price, unfavorable weather |
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Definition
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Term
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Definition
| the market price that, once achieved, remains constant until either the demand curve or supply curve shifts. |
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Term
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Definition
| the market quantity bought and sold per period that, once achieved, remains constant until either the demand curve or supply curve shifts. |
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Term
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Definition
| at a given price, the excess of quantity demanded over quantity supplied. |
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Term
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Definition
| at a given price, the excess of quantity supplied over quantity demanded. |
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Term
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Definition
| a government imposed maximum price in a market |
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Term
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Definition
| a government imposed minimum price in a market |
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Term
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Definition
| an excess supply not eliminated by a fall in price, so that quantity supplied continues to exceed quantity demanded. |
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Term
| price elasticity of demand |
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Definition
| the sensitivity of quantity demanded to price; the percentage change in quantity demanded caused by a 1-percent change in price. |
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Term
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Definition
| elasticity of demand with absolute value between 0 and 1 |
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Term
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Definition
| a tax on a specific good or service. |
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Term
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Definition
| the different combinations of goods a consumer can afford with a limited budget, at given prices |
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Term
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Definition
| the graphical representatino of a budget constraint, showing the maximum affordable quantity of one good for given amounts of another good. |
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Term
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Definition
| the price of one good relative to the price of another. |
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Term
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Definition
| a quantitative measure of pleasure or satisfaction obtained from consuming goods and services. |
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Term
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Definition
| the change in total utility and individual obtains from consuming an additional unit of a good or service |
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Term
| law of diminishing marginal utility |
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Definition
| as consumption of a good or service increases, marginal utility decreases. |
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Term
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Definition
| as the price of a good falls, the consumer substitutes that good in place of other goods whose prices have not changed. |
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Term
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Definition
| as the price of a good decreases, the consumer's purchasing power increases, causing a change in quantity demanded for the good. |
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Term
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Definition
| a sub field of economics focusing on behavior that deviates form the standard assumptions of economic models. |
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