Fundamentals and Micro
Micro
Micro + Macro
Macro and WWII
WWII
100
What you have to give up to get something Ex. what the ____ if you get a 50$ ticket to a bball game and you decide to go instead of mowing your neighbor's lawn for 10$?
Opportunity cost 10$
100
law of supply law of demand
Supply: if price is higher, supply will be more (sUP, positive relationship) Demand: if price is lower, demand will be
100
What is the coase theorem? MICRO
As long as the parties involved can negotiate with each other, the private market should be able to resolve the in- efficiencies created by externalities.
100
If the Fed wishes to increase the money supply, then it...
If the Fed wishes to increase the money supply, then it purchases U.S. government bonds from banks or the public.
100
What was OPA and what did it do? (200)
office of price admin. prevent price inflation and profiteering during wartime prevent hoarding stimulate production and get civilians stuff (considering war)
200
Micro vs macro
Individual decisions and markets vs. overall national economy
200
Where on a supply and demand curve eq occurs. What happens at market eq?
Where curves intersect No supplier or demander has reason to alter their behavior
200
Three types of unemployment + explain
Structural (mismatch of job opps) Frictional (everyday) Cyclical (added unemployment from depression)
200
The alternation of periods of expansion and recession is referred to as the
business cycle
200
The largest recipients of the Lend-Lease program
Recall that the act provided milit and food aid before American involvement in the war. Britian (13.8 billion) and USSR (9.5 billion)
300
Positive vs normative econ
Positive: what we "are positive" or predict will happen under certain circumstances Normative: what we should do, uses value judgements
300
When a decline in the price of one good causes a reduction in the quantity demanded of another, we say that these goods are ___________ As opposed to ___________
substitutes complements
300
Goods w/ low degree of rivalry but a high de- gree of excludability
Collective goods
300
Factor the US GDP has increased by since 1900
32
300
The 21 Demands refer to ____________. When?
Japan's secret to China to make it a client state. 25 yrs before WWI
400
Describe Pareto Efficiency and implications
No way to improve one person's well being w/o reducing that of another Must use all of resources (doesn't matter how you allocate)
400
Explain both a price floor and a price ceiling
Price floor: set a min price ABOVE eq., causes surplus, some suppliers benefit Price ceiling: set a max price BELOW eq, causes shortage, improves welfare of only some consumers Both usually result in a reduction of welfare.
400
Two financial intermediaries
Banks (banks) and mutual funds (purchase a portfolio of stocks and bonds and sell shares to savers)
400
What is the velocity of money?
The velocity of money as the average number of times a typical dollar bill is used during a year.
400
What did the Dawes Plan of 1924 do?
1. Restoration of the Ruhr industrial region to German control. 2. Restructuring of reparations payments. 3. Restructuring of the German central bank, the Reichsbank.
500
Monopolistic competition
Markets in which companies produce similar but different products NOT A MONOPOLY
500
Barriers to entry in a monopoly (can you give examples of companies that use these barriers)
Ownership of key resource, natural monopoly (one can supply at a cost that is less than two or more supplying, large fixed costs usually), gov't monopoly
500
Equity finance vs. debt finance
Equity finance (sale of shares of stock)(stock share reps ownership of a portion a firm), Debt finance (sale of bonds) (bond ~ IOU)
500
What is the ratchet effect and who coined it?
The “ratchet effect” was coined by economic historian Robert Higgs to describe the permanently larger government presence that not only emerges during national emergencies like World War II, but that persists even after the emergency has receded.
500
name for the tax of 1942 established a top margin- al tax rate of 88 percent
"victory tax"
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