The Basics
Economic profit takes what type of cost into account that accounting profit does not?
Implicit costs
Relative to the efficient quantity, how much does a profit-maximizing monopoly produce?
Less
If 1 US dollar initially buys 10 pesos and then, after the waving of Mr. Kashdan's magic wand, 1 US dollar now buys 20 pesos, what happened to the value of the US dollar relative to the peso?
It appreciated
If the price of pizza goes up, what will happen to the demand for garlic knots, a complementary good to pizza?
It will decrease
$0
If Aisla chooses to buy movie tickets for $10 instead buying a book for $8, what is the opportunity cost of that movie?
The book and $2
What will profit be for a firm that is Monopolistically Competitive in the long run?
When your currency appreciates, does the relative level of attractiveness of your goods increase, decrease, or remain constant?
Decrease
If Aisla sells Hermes bags on the resell market and she experiences demand for her product that is relatively inelastic, Aisla increasing the price of her bags will have what effect on her revenue?
If a firms are earning positive economic profit in the short run, what will happen to the number of firms in the market?
It will increase
When one person can produce more of a good than another, that person has the _________ in production
Absolute advantage
At what point on the Average Total Cost curve does it intersect the Marginal Cost curce?
At the minimum
What is the global reserve currency?
The US Dollar
New York City has just decided to implement a rent control program for some of the apartments in Manhattan. If we assume that this is a binding price ceiling, what impact would this program have on the quantity of housing available in Manhattan?
It would decrease
Why does marginal cost initially have a downward slope?
Firms have increasing returns
If you are producing inside the Production Possibilities Curve, what can be said about your quantity of output?
It is inefficient
At what point on a Monopoly graph is the firm producing at the Break-Even Point?
When Price = Average Total Cost
Currency fits into which definition of money?
M1
What is the key assumption that explains why the short run aggregate supply curve is upward sloping?
Wages are sticky in the short run
What must be true for a firm to keep producing in the short while having a negative economic profit?
Price is greater than or equal to Average Variable Cost
What central problem does Behavioral Economics address?
People do not always act perfectly rationally
Mr. Kashdan loves Pearl Jam, which attacked this company for monopoly power.
Ticketmaster / Live Nation
The currency of Brennanville has deppreciated relative to the Jonnybuck of Jonnyland - Brennanville's only trading partner. What will happen to the Aggregate Demand curve of Brennanville's economy?
It will shift right / increase
Mr. Kashdan's magic wand is back. He waves it and is able to determine every customer's willingness to pay for his Econ textbooks. What will happen to the consumer surplus for his textbook "Don't Ask, Just Read"?
It will decrease to zero
Dashiel sells quote posters in a perfectly competitive market. If Dashiel decides to stop selling posters and retire to a beach in a different country, what will happen to the equilibrium price of quote posters.
It will remain the same