Vocabulary
Lack of resources
What is Scarcity?
The Measure of satisfaction
What is utility?
The additional quantity of output is produced by using one more unit. Also is the change in output
What is Marginal Product
What type of market has Many firms, Low barriers to entry, Zero Economic Costs, Differentiated Products
What is Monopolistic Competition.
Is a lighthouse a positive or negative Externality?
What is positive?
exchange something of value to gain something else.
What is Trade-off?
Quantity Demanded = Quantity Supplied
What is Market Equilibrium
Which of the following is ignored when calculating accounting profit?
A. Total revenue
B. Variable costs
C. Implicit costs
D. Fixed costs
E. Total costs
What is Implicit costs
Study of behaviors in situations of interdependence
What is Game theory?
Is this an example of a progressive or regressive tax system?
Taxes are lower % on people earning a higher income.
Increases income inequality.
What is Regressive tax?
The change in total cost caused by producing one more unit of output.
What is Marginal Cost?
What is MUa/Pa = MUb/Pb
What is Optimal Consumption Bundle?
What is a time period in which at least one input is fixed
What is the Short Run
A monopolistically competitive firm’s demand curve will be least elastic if...
A. the number of rival firms producing very similar products increases
B. the number of rival firms producing more differentiated products increases
C. he number of rival firms producing very similar products decreases
D. the number of rival firms producing more differentiated products decreases
E. a monopolistically competitive firm’s demand curve becomes perfectly elastic
What is D. the number of rival firms producing more differentiated products decreases
What are the 4 factors of production?
What is Land, Labor, Capital, and Entrepreneurship
When the long-run Average Total Cost is increasing as output is increasing. If inputs double, output less than doubles
What is Diseconomies of Scale?
A production possibilities curve can shift inward if there is..
A. an increase in productivity
B. an increase in unemployment
C. an increase in the price of raw materials
D. a misallocation of resources
E. a natural disaster
What is E. A natural disaster
If total revenue is increasing as output increases, marginal revenue is always...
A. equal to average revenue
B. less than average revenue
C. increasing
D. decreasing
E. greater than zero
What is E. greater than zero
An airline offering different ticket prices based on factors like travel dates, seat class, and booking time, aiming to maximize revenue by charging different prices to different customer segments, exemplifies price discrimination. What economic principle is displayed In this example?
What is Price Discrimination?
Which of the following Gini coefficients indicates that a country has an equal distribution of income?
A. 1
B. 0.7
C. 0.5
D. 0.2
E. 0
What is E. 0
A cost that has already been incurred and is nonrecoverable. Should be ignored in a decision about future actions.
What is Sunk Cost?
An increase in the supply of coffee could be caused by...
A. a decrease in the price of cream, which is a complement to coffee
B. a decrease in the cost of labor used to produce coffee
C. an increase in consumer income
D. an increase in the demand for coffee
E. an increase in the price of coffee
What is B. a decrease in the cost of labor used to produce coffee
What are the 3 types of profit
What is Accounting, Economic, and Normal profit.
Which of the following is true of a natural monopoly?
A. The average total cost is constant throughout the entire effective demand.
B. Marginal cost decreases throughout the entire effective demand.
C. The average total cost initially decreases and then increases throughout the entire effective demand.
D. The marginal cost initially increases and then decreases throughout the entire effective demand.
E. The average total cost decreases throughout the entire effective demand.
What is E. The average total cost decreases throughout the entire effective demand.
Which of the following will cause a decrease in the demand for labor?
A. A decrease in wage rates
B. An increase in worker productivity
C. A decrease in the price of the product that the labor is used to produce
D. An increase in wage rates
E. Greater preference for leisure rather than work
What is C. A decrease in the price of the product that the labor is used to produce.