The highest valued alternative given up in order to engage in some activity
What is the definition of Opportunity Cost?
100
What does PPF stand for?
Production Possibilities Frontier
100
What is the name of the intersection point between supply and demand?
What is Equilibrium Point
100
What are the 3 types of firms?
Sole proprietorship, corporation, partnership
100
Goods for which the demand increases as income
falls and decreases as income rises.
What is an inferior good?
200
Maria can either go to basketball practice or watch the new episodes of her favorite show on Netflix. If Maria decides to watch her show what is her opportunity cost?
what is practicing basketball
200
True or False; Will the PPF always be positively sloped?
False, negative slope
200
What is the producer surplus made up of?
The area between the quantity supplied and the price
200
What is the name of a financial security that represents partial ownership of a firm.
What is Stock
200
What is the difference between substitute and complement goods?
Substitutes can be purchased in place of one another, complements can be purchased together as a bundle
300
On what side of the balance sheet do Liabilities lie on?
What is the Right
300
What does the PPF compare?
2 goods that can be produced with the given resources
300
The price of motorcycles drops, what will happen to the demand for leather jackets?
Demand will increase
300
What is the present value of $1,000 two years from now at a discount rate of 7%?
1,000/(1+.07)^2= $873.44
300
What are the 4 factors of production?
What is Land, Labor, Capital, and Entrepreneurship
400
Who came up with the idea of the invisible hand?
What is Adam Smith
400
If the PPF has a constant slope what happens to the opportunity cost as you produce more of one good?
What is it remains consistant
400
The price of paper decreases, what will happen to the supply/demand graph of textbooks.
What is Supply will increase
400
You buy a stock at $600. It pays an annual dividend of $6 at a rate of 5%. Assuming you plan to hold onto the stock long term. what is the total value of the annual dividends in present value?
6/.05=$120
400
An economy in which the government decides how economic resources will be allocated?
What is Centrally Planned Economy
500
Jack and Sally can either carve pumpkins or sew dolls. Who has the absolute advantage in each? Who has the comparative advantage in each?
Pumpkins carved Jack-20 Sally-12
Dolls Sewn Jack-10 Sally-8
AV Jack Both
CA Pump-Jack, Dolls-Sally
500
If there is an influx of migrant workers what will happen to the PPF?
It will move outward in both goods
500
If the equilibrium point is at a price of 10 and a quantity of 7 and a price ceiling in imposed at $15 what will happen to the equilibrium point?
What is Nothing, the market can still reach equalibrium
500
Jenny has stock that she bought for $50 and pays a dividend of $20 annually at a rate of 12%. Growth occurs at a rate of 7%. What is the value of equity after growth?
What is 20/(.12-.07) = $400
500
Elastic demand occurs when a large change in quantity equates to a small change in price. Is this a positive statement, normative statement, or neither?