Fundamentals
Supply and Demand
Determinants
Firm Structures
Trade
100

This flows from households to businesses through the factor market.

What are factors of production?

100

This is the law describing the rationale behind the down sloping demand curve.

What is the Law of Diminishing Marginal Utility?

100

The quantity demanded of this type of good increases as income decreases.

What is an inferior good?

100

Perfectly competitive industries should shut down when this condition is true.

What is P is less than AVC?

100

A point within the PPF represents this.

What is inefficient use of resources?

200

This is the problem faced by society's unlimited wants.

What is scarcity?

200

This law is the rationale behind the upsloping supply curve.

What is the Law of Increasing Costs?

200

This government action serves to decrease input costs and shifts supply right.

What are subsidies?

200

The demand curve for perfectly competitive industries is equal to these.

What is MR, AR, P?

200

A country has a comparative advantage in the production of a good if this is true.

What is having a lower opportunity cost?

300

Pablo can either study, mow the lawn for $10, or paint the fence for $5. The opportunity cost of him studying is this.

What is $10?

300

If iPhones suddenly become cheaper relative to Samsung phones, then people buy more iPhones. This effect represents the given situation.

What is the substitution effect?

300
Determinants of demand include related goods prices, income, expectations, number of buyers, and this.
What is consumer preferences?
300

Because a monopolist produces at P > MC, it is not this.

What is allocatively efficient?

300

A situation where the number of hours needed to produce a given amount of quantities is this type of situation.

What is an input situation?

400

Factors of production include, land, labor, capital, and this.

What is entreprenurial ability?

400

This situation is caused by a price ceiling, where quantity demanded exceeds quantity supplied.

What is a shortage?

400
Determinants of supply include government actions, technology, producer expectations, input prices, number of sellers, and this.
What is weather?
400

A monopolistically competitive firm makes this type of profit in the long run.

What is normal?

400
Outward shifts of the PPF can be caused by these.
What are improvements in technology and increases productivity?
500

Given society's unlimited wants and limited resources, society must make these.

What are trade offs?

500

This is the difference between the price a consumer is willing to pay and the price actually paid.

What is consumer surplus?

500
The Law of Supply states that given this, quantity supplied increases as price increases.
What is all other things equal?
500

Relationships between oligopolist firms are characterized by this principle.

What is mutual interdependence?

500
If Japan can produce 5 computers in an hour and the US can produce 10 computers in 2 hours, the absolute advantage belongs to this party.
What is both countries?
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