Numbers
The median house in the US currently is approximately
$417,000
Define Economics
The study of how society manages its scarce resources
What do the 7 largest US companies have in common?
They are technology companies
The property of society getting the most it can from its scarce resources is called
efficiency
_____________ is the head of the Fed.
Jerome Powell
The federal deficit is approximately _______
$2 Trillion
What is the price elasticity of demand (midpoint) formula?
Price elasticity of demand=
(Q2-Q1)/[Q2+Q1)/2]/(P2-P1)/[(P2+P1)/2]
Which of the following does the Federal Reserve not do?
Conduct fiscal policy
The opportunity cost of an item is
what you give up to get that item
What is ∆Q
Change in output
The US national budget deficit is approximately
$2 trillion
The price of gasoline rises 50%. Is price elasticity higher or lower in the long run?
Price elasticity is higher in the long run.
What are the big three investment companies that are top shareholders in most major US corporations?
1) State Street
2) Vanguard.
3) Blackrock.
What is principle 1? Provide an example
People face trade-offs. Ex. Go out to a party the night before an exam --> study less
After a tax is imposed on the market for bottled water, the price buyers pay is $2.50 per bottle and the price sellers receive is $1.75. If the equilibrium price was $2.00 before the tax was imposed on the market, what can you conclude about the relative elasticities of demand and supply?
Supply is more elastic than demand
The US debt is ____________.
Over 36 Trillion
Prices of both of these goods rise by 20%.
For which good does Qd drop the most? Why?
Price elasticity is higher for the Rolex watches because price elasticity is higher for luxuries than for necessities.
NVIDIA is in the industry of __________.
Artificial Intelligence hardware
Who wrote the Wealth of Nations?
Adam Smith
In a market economy, who makes the decisions that guide most economic activity?
Firms and households
A bank has an 8 percent reserve requirement, $10,000 in deposits, and has loaned out all it can, given the reserve requirement.
It has $800 in reserves and $9,200 in loans
List the first 4 principles of economics
Principle 1: People face trade-offs.
Principle 2: The cost of something is what you give up to get it.
Principle 3: Rational people think at the margin.
Principle 4: People respond to incentives.
The health care market is an example of Americans ________________, and ________________________?
Paying a lot, getting a little
When prices are falling, economists say that there is
delfation
US M2 is approximately __________
22 Trillion