Basic Econ Concepts
What are the 5 types of cost ?
Opportunity cost
Implicit cost
Accounting cost
Explicit cost
Economic cost
When do markets and trades occur ?
When producers and consumers exchange goods voluntary and when they also agree on a price .
What process allows to us to add up prices and compare goods in order to make good market decisions ?
Aggregation
What are 3 forms of unemployment ?
1. Structural
2. Cyclical
3. Frictional
What was one piece of logic from MERCANTILISM ?
More wealth = more political power
What is the meaning of the "invisible hand " ?
The market regulates itself .
What does quantity demanded mean ?
The amount of a good costumers will demand at a given price .
What is demand ?
Price to quantity demand .
What is a GPD ?
Is a measurement that seeks to capture a country's economic output.
How were welfare ratios used?
To measure the economic status of workers and to represent how well a man could support his family.
What is a marginal benefit ?
The maximum amount a consumer will pay for one additional good or service
Why can demand curves shift ?
Factors external to the market or exogenous factor.
What are the 2 different types of surplus ?
Consumer and producer
What is inflation ?
An increase price level or a decrease in the value of money .
How much did the Boston tea party cost the British empire ?
1.6 million dollars in todays money
What is the difference between ABSOLUTE and COMPARATIVE advantage ?
Absolute advantage means the ability to produce more of a good using the same amount of resources and comparative advantage means the ability to produce a good at a lower opportunity cost
What is the law of demand ?
A higher price leads to a lower quantity demanded and that a lower price leads to a higher quantity demanded.
What is the law of supply ?
As prices rise, the quantity supplied increases. as prices fall, the quantity supplied decreases
What is not included in GPD ?
Intermediate goods, black market goods , used goods and transfer payments.
What does a Gini Coefficient measure ?
Income distribution and inequality
What are the 5 things to remember as an economics ?
1.Resources are limited
2.People have unlimited wants
3.Not all wants can be met
4.To get we must give up something
5. Giving something up is a trade-off
What is the price elasticity equation ?
E =%changeinq ~ (qF-q1/q1
What do Monopolists create ?
Artificial scarcity
What are the 2 types of money ?
Commodity and Fiat money .
What was Hamilton's 3 part plan ?
Funding the national debut , Taking over state debuts and creating a national bank .