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sophomore year sem 1 > Econ exam review > Flashcards

Econ exam review Flashcards

1
Q

Productions possibility curve

A

graph that shows possible quantities that can be produced by 2 products

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2
Q

economic independence

A

ability of an individual to be self-sufficient

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3
Q

capital goods

A

tools, equipment, machinery, and factories used in production of goods and services

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4
Q

trade-offs

A

things you give up

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5
Q

opportunity cost

A

your next best option when making a choice

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6
Q

goods

A

a real tangible item that has a use and satisfies a want

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7
Q

services

A

work that is performed by someone

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8
Q

circular flow

A

economic model that shows exchange of money for goods and services in our economy

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9
Q

law of supply

A

as price inc, business inc production; as price dec, business will dec production

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10
Q

law of demand

A

when consumers willing to buy more of a product at a lower price and less at higher prices

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11
Q

determinants of demand

A

income, substitutes, complements, consumer tastes, expectations, price

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12
Q

determinants of supply

A

cost of resources, productivity, technology, taxes, subsidies, expectations, government regulations, number of sellers

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13
Q

elasticity of demand

A

measurement that shows how a change in quantity demanded responds to a change in price

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14
Q

elasticity of supply

A

measure of quantity supplied to a change in price

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15
Q

3 big questions of economics

A

what will be produced, how will it be produced, how will it be distributed

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16
Q

scarcity

A

society doesn’t have enough of the resources to produce everything we want

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17
Q

factors of production

A

land, labor, entrepreneurship, capital goods

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18
Q

entrepreneurship

A

most powerful people in economy, start businesses, and have ideas

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19
Q

traditional economies

A

getting resources based and other econ activities based on ritual, tradition, custom

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20
Q

command economies

A

government (central authority) tells you what to make

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21
Q

market economies

A

supply and demand

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22
Q

mixed economies

A

traditional, command, and market -> poor

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23
Q

free enterprise

A

capitalistic econ where resources privately owned and competition allowed to flourish without government involvement

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24
Q

role of consumers in economy

A

consumers rule economy and decide what is made

25
Q

fixed costs

A

costs that are independent of volume (rent, insurance)

26
Q

variable costs

A

costs that change as the volume changes (gas, labor)

27
Q

gross domestic product (GDP)

A

$ value of all our final goods and services and structures produced within a country during 1 yr per

28
Q

real gdp

A

GDP after adjustment for inflation

29
Q

business cycles

A

regular inc/dec in real gdp overtime in econ

30
Q

phases of business cycle

A
  1. peak: real gdp stops growing
  2. recession: decline in real gdp
  3. trough: econ turning around
  4. recovery: uninterrupted growth
31
Q

recession

A

decline in real gdp

32
Q

depression

A

state of econ with high unemployment, Dec incomes, shortages, general econ hardships

33
Q

inflation

A

inc in general level of prices for goods and services

34
Q

federal reserve

A

central bank of u.s., is controlled by member banks

35
Q

consumer price index

A

stat series used to measure changes in price level overtime

36
Q

deflation

A

Dec in general level of prices for goods and services

37
Q

stagflation

A

higher inflation with low econ growth and high unemploymment

38
Q

hyperinflation

A

extreme inflation of 500%

39
Q

types of unemployment: structural

A

need for less workes

40
Q

types of unemployment: cyclical

A

response to change in business cycle

41
Q

types of unemployment: technological

A

demand for certain jobs dec around change of seasons

42
Q

types of unemployment: fricitonal

A

short term when workers in btwn jobs

43
Q

Adam smith

A

an inquiry into the nature and causes of the wealth of nations

44
Q

“the invisible hand”

A

how free markets can motivate individuals, acting in their own self-interest to produce what society needs

45
Q

types of taxes: proportional

A

takes same % amount from high and low income

46
Q

types of taxes: progressive

A

take larger share of income from rich compared to poor

47
Q

types of taxes: regressive

A

take larger share from poor compared to rich

48
Q

main source of tax revenue for local, state, and national government

A

local: property taxes
state: income and sales taxes
national: individual/corporate income taxes, social insurance taxes (social security)

49
Q

stock market

A

a set of exchanges and other reserves where shares of publicly held companies are bought and sold

50
Q

monetary policy

A

focused on interest rates and $ supply, governments plan to control currency and circulation of wealth in econ

51
Q

interest rates

A

proportion of a loan that is charged as interest to the borrower (annual % of loan)

52
Q

income

A

$ received, normally on regular basis for work or thru investments

53
Q

price controls

A

price floor: lowest legal price can charge for product
price ceiling: highest legal price can charge for product

54
Q

budget deficit

A

when spending of federal government is > revenue brought in

55
Q

national debt

A

total amount of $ that a country’s government has borrowed

56
Q

subsidies

A

sum of $ by government or public body to help an industry or business so price of service always stays low/competitive

57
Q

free trade

A

international trade

58
Q

protectionalism

A

practice of shielding a country’s domestic industries from foreign competitors by taxing imports

59
Q

tariffs

A

tax or duty to be paid on a particular class of imports or exports

sophomore year sem 1 (20 decks)

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