Unit 2 Economics – Flashcards
Unlock all answers in this set
Unlock answersquestion
Price Floor
answer
A government controls the limits how low it can go
question
Tragedy of the commons
answer
What is the name given to the over use of public goods
question
When one charactertistics of a market economy is absent, making it impossible to be efficent.
answer
What is a market failure?
question
Equal buyers and equal sellers
answer
Definition of Equillibrium
question
Doesn't move
answer
An increase in the number of buys causes the supply curve to move in what direction?
question
decreases
answer
Law of supply as price falls quantity _______
question
Shift to the right (increase)
answer
Input decreases, what will happen to the curve?
question
Equillibrum
answer
What point is the economy most efficent?
question
Demand curve P: increase Q: increase
answer
Monster and Redbull are susbstitues, if the price of the Monster increases. What is the price and quantity?
question
Price: increases Q:decreases
answer
A severe drought has happened in TX. What happens to the equillibrum price and quantity of corn?
question
moving along the curve (change in price)
answer
A shift in the quantity supplied is represented by what type of movement?
question
Subsitution effect
answer
An individual is choosing to buy another good because the other price is higher? What is this?
question
shortage
answer
A situation where demand for a good is greater than a supply creates a _______
question
P: decrease Q: increase
answer
New machines are at faster rates. What will happen to the equillibrum price and quantity for computer?
question
go down
answer
Price of has increased what would happen to the supply for guitars?
question
a. near/vertical b. inelastic
answer
Demand curve for water ______ because it is an __________ good
question
Negative externalities
answer
Pulltion is a clear example of what market failure?
question
1. Income effect 2. Subsitution effect 3. Normal Good 4. Inferior Good 5.Consumer tastes 6. Expectations 7. Number of consumers
answer
List the 7 shifts of demand
question
1. Input prices 2. Technology 3. Number of sellers
answer
List the 3 shifts of the supply curves
question
When the price is high the willingness to sell be high
answer
What is the supply of law?
question
As a price increases, the quantity demanded will decrease
answer
What is the law of demand?
question
Willingness to pay for something
answer
Definition of demand?
question
The extra usefulness and satisfaction that you get from getting a product
answer
Definition of Marginal Utility?
question
The more we purchase we get the less happy it brings to us when we use it. Ex: The excitment you get for using an Iphone for the first time, to the time where you try out the IPhone for the third time.
answer
Definition of Diminishing Marginal Utility?
question
The amount that the producer is able and willing to produce and sell at each potential price during a specified amount of time.
answer
What is supply schedule?
question
How much the good will sell for a the equillibrum
answer
Equillibrum price, what is it?
question
A good or service that requires to money and can be used by all members of a community or society. Ex: Park, public weight room or community pool
answer
What is a public good?
question
below
answer
Price ceiling is ______________ the equillibrum
question
above
answer
Price floor is ________________ the equillibrum
question
efficent
answer
When the market is equillibrum it is __________ as possible
question
Supply increasing moves to the right. Supply decreasing moves to the left.
answer
How does a supply curve move (when it increases and decreases)
question
Supply will increase with technology...It will be easier and cheaper to produce
answer
What's technology?
question
Cost to make the item.... (if cost cost rises= supply will shift to the left) (if cost falls= supply will shift to the right)
answer
Whats input prices?
question
more people selling stuff= the more stuff there is (shift moving to the right)
answer
Number of sellers?
question
efficency
answer
______ outcomes are good for economy, but bad for the society
question
surplus
answer
Too much supply and to little demand
question
shortage
answer
Suply is lower than demand
question
movement along the demand curve
answer
Change in quantity demanded (moves how?)
question
Change in quantity demanded because of a change in a price that alters consumers' real income. Ex: If income went up on a price, they may feel poorer.
answer
What's income effect?
question
changing from a different item to a new one that is cheaper
answer
What's the subsitution effect?
question
There opinion changes on things like different styles in clothing through out the year
answer
Consumer taste?
question
Thinking about the future and how it will affect them
answer
Expectations
question
income, prices and taste affects someone if they are going to a buy an item
answer
Number of consumers
question
If it can be purchased later? If there is subsitutes? Does it use large amount of your income?
answer
How to know if it elasticity?
question
A vacation to the Bahamas. Buying a North Face coat
answer
Example of elasticity?
question
Horizontal
answer
Is elasticity vertical or horizontal?
question
Vertical
answer
Is inelasticity vertical or horizontal?
question
Something that you need and that you can't put off. You need this to survive.
answer
Inelastcity
question
Gas when you have no gas left in your tank. Water Surgery
answer
Examples of inelastcity
question
People act in their own interest to know who it is for, how and what
answer
Market economy
question
Factors change while price remains the same
answer
Change in demand
question
products that increase the use of another product ex: tooth brush and tooth paste peanut butter and jelly
answer
Compliments
question
Amount of production offered for sale at all possible prices in the market
answer
Definition of supply?
question
A graph that shows the quanitities at each and every possible price in the market
answer
Definition of supply curve
question
Harm , cost and ionconvience is suffered by a third party ex: pollution
answer
Definition of negative externalities
question
when someone benefits who was not invovled in an activity
answer
Positive externalities
question
Doesn't have much information about a company
answer
Indadquate information
question
having larger and less firms
answer
Inadequate competition
question
factors of production will not move until they are used
answer
Resource immobility
question
Is when the curve shifts entirely
answer
A change in demand
question
refers to a movement along the supply curve
answer
A change in quantity supplied
question
complements
answer
An increase in the price of cameras results in a decrease in the demand for film. the two producs are
question
elastic
answer
when a customer's need for a product is not urgent demand tends to be
question
a change in the numbers of sellers offering the product
answer
Which of the following will cause the market supply curve to shift
question
the quantity supplied is greater than the quantity demanded
answer
At a given price a surplus occurs when
question
a societal choice for equillibrum equity over efficency
answer
the federal minimum wage law demonstrates
question
a lot of firms, no influence of price, easy to statr
answer
Perfect comp
question
One firms, extensive price control and impossible to get into market
answer
Pure monopoly
question
overuse of public goods
answer
Selling permits one way that the government can potentially solve which of the following market failures
question
overuse of public goods
answer
the tradegy of commons is used to illustrate which of the 5 major types of market failures
question
negative externality
answer
Pollution is an clear example fo which type of market failure
question
desire ability and willingness to buy a product
answer
Demand
question
extra usefullness gained from using one more unit for a product
answer
Marginal utility
question
listing that shows the quantities demanded of a product at all prices
answer
Demand schedule
question
measure of consumer responsiveness thtat shows how a dependent varibale responds to a change in independent variable
answer
elasticity
question
products used in place of other products
answer
susbsitutes
question
describes change in demand when a gien change in price cxauses a proportioanl change in quantity demande
answer
elastic
question
change in quantity demanded of a product at all prices
answer
susbitution effect
question
where this occurs resrouces slowly shift to other markets where equilibrum prices prevail
answer
price ceiling
question
unsold procut that causes suppliers to reduce their prices
answer
surplus
question
condition that leaves producers wishing they had charged a higher price for their products
answer
shortage
question
situation in which the quantity of goods and services supplied equals demand
answer
market equillibrum
question
the min wage the lowest legal price that can be paid to most workers
answer
price floor
question
price thaat clears the market
answer
eqilibrum price
