Chapter 5: Elasticity
Chapter 6: Govt Policies
Chapter 6: Taxes
Chapter 7: CS/PS
Chapter 8: Cost of Taxation
100
The demand curve is drawn horizontally.
What is perfectly elastic?
100
when no government policies are implemented and the market returns to its natural state
What is equilibrium?
100
the direction the supply curve moves in because of a tax imposed on sellers
What is a shift to the left in supply >>> increase in cost
100
the amount a buyer is willing to pay minus the price they pay
What is consumer surplus?
100
the loss of economic efficiency that can occur when equilibrium for a good or service is not achievable.
What is deadweight loss?
200
As price changes, quantity demanded changes at a smaller percentage.
What is inelastic demand?
200
price set is below equilibrium but causes no shortage.
What is a non-binding price floor?
200
the difference between what the buyer pays and what the seller receives
What is a tax?
200
the shape of CS and PS
What is a triangle?
200
elasticity that creates a smaller dead weight loss
What is inelastic?
300
In cross price elasticity, it is shown as a negative number
What are complementary goods?
300
the effect created from a binding price ceiling
What is a shortage?
300
burden carried by both producer and consumer
What is incidence of tax?
300
where total surplus is maximized
What is equilibrium?
300
As the __________ increases, CS and PS decrease
What is tax?
400
The four elasticities discussed in class
What are price elasticity of demand, price elasticity of supply, income elasticity of demand, and cross-price elasticity of demand?
400
The legal minimum price a good can be sold at set by the government
What is a price floor?
400
the type of elasticity that will cause a larger tax revenue
What is inelastic?
400
the self-interest of the market, in which the buyer and seller put market back in place
What is Adam Smith's invisible hand?
400
when the tax doubles, Dead weight loss _________
What is more than doubles?
500
the determinants of elasticity
What are close substitutes, necessity vs luxury, market definition, time horizon?
500
the definition of a price ceiling
What is the legal maximum price a good can be sold at?
500
the effects from a tax imposed by the government. (increase/decrease) ____________ in the price buyers pay ____________ in the price sellers receive
What is increase then decrease
500
the value to the buyer minus the cost to the seller
What is total surplus?
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