Role of Government
What is a tax that depends on the amount of pollution that a firm produces?
What is Emission Tax ?
Normal Good rises when
When a rise in income increases the demand for a good, what is a normal good?
five key elements in Supply and Demand Graph
The demand curve
The supply curve
market equilibrium
Market price
Market quantity
The value of perfectly inelastic demand
0
What is Total Profit= Total Revenue - Total Cost?
What is a payment designed to encourage purchases and activities that yield social benefits ?
What is a Pigouvian Subsidy?
When a rise in income decreases the demand for a good
What is an inferior good?
The supply schedule is
What is a table that shows the relationship between the price of a good and the quantity supplied ?
The significance of unit elastic demand is
What is that changes in price has no effect on total revenue ?
What is where marginal revenue = marginal cost?
What are the two forms of price control that a government can impose on society ?
What is a Price ceiling and price floor?
Complement goods are negative when
When is quantity demanded of one good falls when the price of another rises ?
The curve is perfectly elastic supply curve
Is it horizontal ?
The value of perfectly inelastic supply is 0
Price has no effect on quantity supplied
the equation for accounting and economic profit
What is economic profit equation which is the total revenue minus the opportunity cost
What is the accounting profit equation which is total revenue minus explicit cost minus depreciation
Name 2 of the three common results in a price ceiling
a persistent shortage of the good
inefficiency arising from this persistent shortage in the form of inefficiently low quantity, inefficient allocation of the good to consumers, resources wasted in searching for the good, and the inefficiently low quality of the good offered for sale
the emergence of illegal, black market activity
The difference between substitute and complements goods
What is two goods are substitutes if a rise in the price of one good makes consumers more willing to buy the other goods? What are when buyers tend to consume two goods together, the goods are known as complements ?
the lowest price at which he or she is willing to sell a good.
What is the sellers cost
The value of income elasticity of demand for a normal good
What is positive and less than 1
A firm is selling 100 units at a price of $25. However, to sell 110 units they need to cut the price to $24. What is the average revenue at 110 units?
What is $24 ?
What is the market price floor for the labor market ?
What is minimum wage?
Giffen good is
What is an inferior product that does not have easily available substitutes?
The consumers willingness to pay is the maximum price at which he or she would buy that good.
Consumer surplus
The quantity of a good demanded rises from 1000 to 1500 units when the price falls from $1.50 to $1.00 per unit. The price elasticity of demand for this product is approximately:
What is 1
the term where total Revenue - total Cost = 0
What is Normal Profit?