Supply and Demand
Market Structures
Market Failures
Math
Visual Clues
100
The sum of quantities demanded at different prices of all consumers in a market.
What is Market Demand?
100
A market structure characterized by a fairly large number of firms selling slightly differentiated products and with low barriers to entry.
What is Monopolistic Competition?
100
A good or service that has both non-rivalry and non-excludability.
What is a public good?
100
(TC - TFC) / Q
What is Average Variable Cost (AVC)?
100
What is a production possibilities curve (frontier)?
200
This is something that happens when the cost of inputs in production increases.
What is a decrease in supply?
200
In Game Theory, this situation occurs when neither of the two firms has an incentive to change their current strategy.
What is a Nash Equilibrium?
200
Loss of efficiency due to either over allocation or under allocation of resources toward the production of a good or service.
What is Deadweight Loss (DWL)?
200
(% change in Qd) / (% change in P)
What is Elasticity of Demand?
200
What is a Price Floor?
300
This factor, contributing to the law of demand, states that a decrease in purchasing power will lead to a decline in consumption as price increases.
What is the Income Effect?
300
This is the reason why consumers have a lot of power in a perfectly competitive industry...and why firms are known as price takers.
What is Perfectly Elastic Demand?
300
This tax increases government revenue, but has no effect on production levels for a firm trying to maximize profits.
What is a lump sum tax?
300
(MUx / Px) = (MUy / Py)
....and all income spent.
What is the Utility Maximizing rule/equation/function?
300
What is a Negative Externality?
400
In this production situation, tax incidence falls 100% on consumers.
What is perfectly inelastic supply?
400
Increasing production beyond this point will cause TR to begin to decrease.
What is MR = 0?
400
This economic condition can by caused by the existence of a positive externality or attempted production of a pure public good by a private firm.
What is a Demand Side Market Failure?
400
(MRPL / PL) = (MRPc /Pc) = 1
What is the profit maximizing combination of labor and capital?
400
What is a Monopsony?
500
This phenomenon can occur in the case of an inferior good that is also known as a Giffen Good.
Hint: We had a multiple choice question about this and I brought in an article about it the next day (think potatoes during the Irish Famine).
What is an upward sloping demand curve?
500
In Monopolistic Competition, this is the term that describes empty tables at a restaurant or empty hotel rooms.
What is Excess Capacity?
500
This has a value of zero when a Monopoly is able to perfectly price discriminate.
What is Consumer Surplus?
500
(% Market Sharefirm 1) + (% Market Sharefirm 2) + (% Market Sharefirm 3) + (...) + (% Market Sharefirm n) =
where n represents the smallest firm in the market
What is the Herfindahl Index?
500
What is the Lorenz Curve?