definitions
what is unforeseen events due to altering incentive structure
unintended consequence
as a government adds more government regulations, it is moving more towards a _______ economy.
command
how many firms are in a monoploy
one (mono=one)
what type of economics focuses on analysis of data and information?
positive economics
interest rates are..
amount charged on borrowed money
will a pharmacy, who is one of three to produce medicine for covid, benefit or suffer from trade?
circular flow emphasizes (independence or interdependence or dependence) between firms and househoulds
interdependence, household depends on firm and firm depends on household
true or false: if something is correlated it must mean it is a causation
false, something can be correlated but not be the cause
equilibrium is
quantity supplied= quantity demanded
what is the type of correlation if price of would increase and building of houses decreases?
negative correlation
if market price increases, demand...
decreases
you have $10 and have the option to buy a pizza which you get or chips and a Powerade which is your second best option or go to the car wash. what is the opportunity cost?
the value of buying chips and a Powerade
what is economic incentive
encourages to behave a certain way in exchange for an material reward
if the government wants to slow the economy what fiscal policy should it use?
contractionary
price celling must be placed where to be effective?
below equilibrium point
value of implicit and explicit cost is $1,000
value of benefits both monetary and utility is $500
is this a rational or irrational decision?
irrational, benefits is less than cost
fiscal policy refers to....
the taxing and spending policies of the government
who supports supply-side economics and why?
conservatives/republicans because they believe that without it an increase in taxes will damage the economy since production cost would be raised
a perfect spring has contributed to a great strawberry harvest. what will be the effect on equilibrium price and quantity.
equilibrium price: decrease (more strawberries=cheaper)
equilibrium quantity: increases (good harvest means more strawberries)
what is the main goal of division of labor, specialization, and human capital?
efficiency, an efficient society