Demand
Supply
Equilibrium
PPC
opportunity can cost ya
100
if price increases quantity demanded will go down
law of demand
100
if price increases then the quantity supplied will increase
law of supply
100
if P = $4 then this occurs:
[[P,Qd,Qs],[3,140,80],[4,120,90],[5,100,100],[6,80,110],[7,60,120]]
shortage
100
What does PPC stand for?
Production Possibilities Curve
100
having a lower opportunity cost for a good gives a producer this 'advantage'
comparative advantage
200
Slope of demand curve
downward
200
The expected effect on the market if there were a decrease in the cost of an input.
Increase (right shift) in supply
200
if P = $6 then this occurs:
[[P,Qd,Qs],[3,140,80],[4,120,90],[5,100,100],[6,80,110],[7,60,120]]
surplus
200
Concepts represented on a PPC
Scarcity
Choice
Efficiency
Inefficiency
200
Who has the comparative advantage in producing pies and cakes?
Pies- David
Cakes-William
300
The numeric (table) representation of a Demand Function
demand schedule
300
This 'bottom line' is assumed to be the primary motivator to producers.
profit
300
this price P 'clears the market'
[[P,Qd,Qs],[3,140,80],[4,120,90],[5,100,100],[6,80,110],[7,60,120]]
$5
300
Inside the PPC "curve"
Attainable but inefficient
300
Larry decides to not go to his bicycle repair job which pays him $15 an hour and decides rather to see a 2 hour movie. He purchases a $15 ticket and a 'bucket' of popcorn for $15. What was Larry's total economic cost for this activity?
$60
400
The effect of a tax increase in a market
decrease (left shift) in demand
400
Product A is an input to Product B which is a substitute for Product C.
An increase in the price of Product A has this effect on Product B.
decrease in supply
*shift left*
400
The change in equilibrium price resulting from an increase in supply and a decrease in demand
decrease
400
On the "curve"
Efficient
400
Soccer balls and basketballs are substitutes. An increase in basketball prices would have this effect on the soccer ball market.
increase in demand
500
Difference between substitute good and complimentary good
-Substitute goods are competitors and have opposite reaction to price changes
-Complimentary goods are used together and have same reaction to price changes.
500
The spread of a damaging computer virus would have this effect on the power generation market.
decrease in supply
500
The change in equilibrium quantity resulting from an increase in supply and a decrease in demand
undetermined
500
Outside the "curve"
unattainable
500
In a two market economy, a constant opportunity cost will appear as this type of Production Possibility Curve.
Linear