Supply and Demand
What is the law of supply?
When price goes up, quantity supplied goes up. When prices goes down, quantity supplied goes down.
In a mixed economy, who has the power to make economic decisions?
government and individuals
When making a decision and are "economizing," what two things are considered in that choice?
Anticipated costs and benefits
What is it called when an individual can produce more with the same amount of resources or use less in production?
absolute advantage
What economic term describes the things that motivate or encourage people to do something.
What is the law of demand?
When price goes up, quantity demanded goes down. When price goes down, quantity demanded goes up.
What type of economic system is most common today?
mixed economy
What term do economists use to described your skills, knowledge and education?
human capital
What is it called when an individual has the lowest opportunity cost when producing a particular good?
comparative advantage
If you pay $1000 in taxes on an income of $10,000 and $1,600 in taxes on an income of $15,000, the income tax system is:
progressive tax system
When will people search for substitutes?
When the price of the original good becomes to high
The government hires 2000 workers for new infrastructure projects and has reduced taxes on middle-class incomes. What economic theory is being employed by the government?
Keynesian economics
What term describes the most desirable alternative given up as a result of a decision?
opportunity cost
List three of the factors of production that affect trade.
Land, labor, capitol and entrepreneurship
What type of market failure describes the side effect of production or consumption?
Externality
The price at which supply and demand are in balance is known as:
equilibrium price
List the four market structures from most competitive to least competitive.
Perfect Competition - Monopolistic Competition - Oligopoly - Monopoly
What is the fundamental problem of economics?
Scarcity
Prior to free trade, what economic theory promoted self-sufficiency, strong borders and little to no trade between countries?
Mercantilism or Protectionism
What phrase is used to describe the overuse or under maintenance of common resources?
Tragedy of the Commons
Katie observes that when the price of one good increases, the demand of another good decreases. What type of good is she observing?
complimentary goods
In the United States, and based in Monetary economics, whose in charge of regulating the money supply?
Federal Reserve
This flowchart represents:
More $ → interest rates drop → borrower easier and cheaper → more loans → more spending and investment → demand increases → strong economic growth, low unemployment
Expansionary fiscal policy
List three types of economic barriers.
Quotas, tariffs and embargoes
What economic perspective gives ideologically perspectives?
Normative economics