K Bet
What is the primary function of money in an economy?
Serves as a medium of exchange
What is a tariff?
A tax on an imported goods that protects US businesses
What is the theory of laissez-faire?
Government has no role in Economics (hands off)
Define microeconomics:
Individuals and specific businesses and their spending habits
The law of Demand states that as the price of a good increases, all else equal, the quantity demanded of that good:
Decreases if it's elastic, unchanged if it's inelastic
Define opportunity cost:
Value of the next best alternative forgone
What is a recession?
Period of decreasing economic activity
Demand for education and training programs, Or Factory opens with increased wages,
Define macroeconomics:
Things like US unemployment surging throughout the US and/or the world, big picture economic activity
Give an example of a factor that would cause a shift in demand curve:
A decrease in the price of the good, an increase in consumer income, a decrease in the price of a substitute good
Which economic system has private ownership and free markets as pivotal parts?
Capitalism
What is the best example of a factor of production?
Labor
What is the primary function of the Federal Reserve?
To manage the nation's monetary policy
What is an example of negative externality?
Pollution from a factory, traffic congestion, noise from construction
What is the equilibrium price in a market?
Price at which quantity demanded and supplied is equal.
An increase in the price level of goods and services
What is a monopoly?
A market structure with only 1 seller
What are imports and exports?
Imports are made outside the US and brought in to be sold here, exports are made within the US and sold elsewhere
Why do businesses need a production possibilities curve?
To figure out maximum profit for their good or service
If the demand for a product increases while the supply remains constant, what is likely to happen to the equilibrium price?
It will increase
What is the primary goal of monetary policy?
To control inflation and stabilize the currency
What is the main purpose of fiscal policy?
To manage government spending and taxation
What is marginal cost?
The cost of producing one more unit of a good
If the price of pizza increases, what will happen to the quantity demanded?
Quantity of pizza demanded will decrease because it's elastic
What is a factor that would cause a shift in the supply curve for a product?
A change in the cost of production