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Econ 1-3 > Ch 1-3 > Flashcards

Ch 1-3 Flashcards

1
Q

What is economics?

A

The study of scarce resources and unlimited wants

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2
Q

What is opportunity cost?

A

The value of what you give up to do something else

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3
Q

3 economic ?’s

A

what to produce?
how to produce?
for whom to produce?

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4
Q

Factors of production (resources)

A

land, labor, capital, entrepreneurship

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5
Q

Positive economic statement

A

what is, fact

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6
Q

Normative economic statement`

A

what should be, opinion

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7
Q

Ceteris paribus (CP)

A

other things being equal, nothing else changes

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8
Q

Production possibilities curve (PPC)

A

alternative combinations of goods and services that could be produced in a given time period with all available tech + resources

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9
Q

Increase in PPC (curve shift to right)

A

increase in resources/tech

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10
Q

A point on the PPC curve?

A

efficient

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11
Q

A point inside the PPC curve?

A

inefficient

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12
Q

A point outside the PPC curve?

A

unattainable

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13
Q

Economic growth

A

increase in output (real GDP)

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14
Q

GDP

A

gross domestic product, total market value of all final goods + services produced in 1yr

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15
Q

Per capita

A

per person

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16
Q

Productivity

A

output per unit of input

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17
Q

Role of government

A

legal framework, protect environment, protect consumers + workers

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18
Q

What is demand?

A

shows the quantity of a good that will be purchased by consumers at various prices, CP

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19
Q

Law of demand

A

increase in price leads to a decrease in quantity demand, cp

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20
Q

Law of demand (inverse)

A

decrease in price leads to an increase in quantity demand, cp

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21
Q

Demand curve

A

slopes down

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22
Q

Individual demand

A

one person

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23
Q

Market demand

A

sum of all demand

24
Q

Demand on a graph

A

whole curve

25
Q

Quantity demand on a graph

A

point on curve

26
Q

when price changes (demand)

A

quantity demand changes (movement)

27
Q

when “other things” change (demand)

A

demand changes (shift)

28
Q

decrease of demand on a graph

A

left on a graph

29
Q

increase of demand

A

right on a graph

30
Q

“other things” that change demand

A

taste/desire, income, other goods, expectations, # of buyers

31
Q

Complementary goods (go together)

A

if price of X increases then quantity demand of X decreases and the demand of Y decreases

32
Q

Substitutes (either/or)

A

if the price of X increases then quantity demand of X decreases and the demand of Y increases

33
Q

What is supply?

A

shows quantity of a good that will be produced by sellers at different prices, CP

34
Q

Law of supply

A

increase in price leads to increase in quantity supply, cp

35
Q

Law of supply (inverse)

A

decrease in price leads to decrease in quantity supply, cp

36
Q

supply curve

A

slopes up

37
Q

individual supply

A

one person

38
Q

market supply

A

sum of all supply

39
Q

supply on a graph

A

whole curve

40
Q

quantity supply on a graph

A

point on curve

41
Q

when price changes (supply)

A

quantity supply changes (movement)

42
Q

when “other things” change (supply)

A

supply changes (shift)

43
Q

increase in supply

A

right on a graph

44
Q

decrease in supply

A

left on a graph

45
Q

“other things” that change supply

A

tech, factor costs, other goods, taxes/subsidies, expectations, # of sellers

46
Q

Equilibrium

A

point of balance (market)

47
Q

At equilibrium on a graph

A

Quantity demand equals quantity supply

48
Q

surplus

A

excess quantity supply, too high

49
Q

shortage

A

excess quantity demand, too low

50
Q

increase in demand as it relates to Equil?

A

increase in equil price and increase in equil quantity

51
Q

decrease in demand as it relates to Equil?

A

decrease in equil price and decrease in equil quantity

52
Q

increase in supply as it relates to Equil?

A

decrease in equil price and increase in equil quantity

53
Q

decrease in supply as it relates to Equil?

A

increase in equil price and decrease in equil quantity

54
Q

price floor

A

minimum price for good, must be above equilibrium

55
Q

price ceiling

A

max price for good, must be below equilibrium

56
Q

in economics…

A

ceilings are below floors

Econ 1-3 (1 decks)

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