A
What does the Law of Demand state?
As price decreases, demand increases or As price decreases, demand decreases
What are trade-offs?
The choices and sacrifices made due to scarcity
What does opportunity cost refer to?
The value of the next best alternative that is given up when a choice is made
When the government prints too much money, increasing the money supply
Inflation
This is the point where the quantity supplied equals the quantity demanded
Equilibrium
Which of the following is NOT a determinant of demand:
Consumer preferences or Production costs
Production costs
How does competition affect prices in a market?
It keeps prices low
What is liquidity?
The ease with which an asset can be turned into money
A __________ is a government-set minimum price that buyers cannot go below.
Price floor
In a _____________ economy, private individuals own the means of production
Market or Capitalist
Which of the following is an example of a production resource: labor, raw materials, demand for goods, interest rates
labor
The additional or extra cost or benefit of doing one more unit of something in economic decision making is called ___________
Margin
This is a government payment to industries so they can compete with the market.
subsidy
When there is a movement along the demand curve due to a price change, it is called ___________
Change in quantity of demand
Assets that are immediately available for exchange
Money
What causes a shortage in the market?
The quantity demanded is greater than the quantity supplied
The most liquid forms of money, such as currency and checking deposits are represented by this letter and number abbreviaton
M1
Tools, equipment, machinery, and buildings used in production are called _________ goods.
capital goods
A ___________ is a market structure is there only one significant buyer
Monopsony
Keeping markets competitive and minimizing public goods is how the government can prevent ___________
Market Failure
Shifters of the supply curve include which of the following: Consumer preferences,
Consumer income, Prices of related goods, Production costs and technology
Production costs and technology
Why is a monopoly considered inefficient?
Because the supplier has no motivation to improve production or distribution
The price of cacao beans, an ingredient in chocolate, plummets. What happens to the supply curve for chocolate?
Supply curve shifts right indicating an increase in supply
The government enacts a tax on soda producers and the price of soda increases. What happens tot the demand curve for soda?
Quantity demanded decreases
When the amount of money goes down, it causes the value of money to _________
Increase