ECON MIDTERM

Question 1

insufficiency of resources to meet the wants of consumers and insufficiency of resources for producers that hamper enough production of goods and services.

Answer 1

Scarcity

Question 2

as a study, is the social science that involves the use of scarce resources to satisfy unlimited wants.

Answer 2

Economics

Question 3

he said that economics as the study of mankind in the ordinary business of life.

Answer 3

Alfred Marshall

Question 4

is a condition where there are insufficient resources to satisfy all the needs and wants of a population. Scarcity may be relative or absolute.

Answer 4

Scarcity

Question 5

is when a good is scarce compared to its demand.

Answer 5

Relative scarcity

Question 6

describes resources that are fixed in supply and cannot be increased or decreased, regardless of demand. Their supply is hard-capped due to intrinsic limitations.

Answer 6

Absolute scarcity

Question 7

A division of Economics that is concerned with the overall performance of the entire company. It studies economic system as a whole rather than the individual economic units that make up the economy.

Answer 7

MACROECONOMICS

Question 8

is about the nature of economic growth, the expansion of productive capacity and the growth of national income.

Answer 8

MACROECONOMICS

Question 9

is concerned with the behavior of individual entities such as the consumer, the producer, and the resource owner.

Answer 9

MICROECONOMICS

Question 10

It is more concerned on how food flow from the business firm to the consumer and how resources move from the resource owner to the business firm. It is also concerned with the process of setting prices of goods that is also known as ??

Answer 10

PRICE THEORY.

Question 11

Refers to the value of the best forgone alternative.

Answer 11

OPPORTUNITY COST

Question 11

With the presence of scarcity, there is a need to make decisions in choosing how to maximize the use of scarce resources to satisfy many wants as possible.

Answer 11

CHOICE AND DECISION MAKING

Question 12

BASIC ECONOMIC PROBLEMS OF THE SOCIETY

Answer 12

1. What to produce;
2. How much to produce
3. How to produce and
4. For whom to produce.

Question 13

is the means through which society determines the answers to the basic problems mentioned. A country may be under any of the following types or even a combination of the three -

Answer 13

ECONOMIC SYSTEMS

Question 14

what are the economic systems?

Answer 14

TRADITIONAL ECONOMIC SYSTEM
COMMAND ECONOMIC SYSTEM
MARKET ECONOMIC SYSTEM

Question 15

Decisions are based on traditions and practices upheld over the years and passed on from generation to generation. Methods are stagnant and therefore not progressive. Traditional societies exist in primitive and backward civilizations.

Answer 15

TRADITIONAL ECONOMIC SYSTEM

Question 16

This is when the authoritative system wherein decision-making is centralized in the government or a planning committee. Decisions are imposed on the people who do not have any say in what goods are to be produced. The economy holds true in dictatorial, socialist, and communist nations.

Answer 16

COMMAND ECONOMIC SYSTEM

Question 17

This is the most democratic from of economic system. Based on the workings of demand and supply, decisions are made on what goods and services to produce. People’s preference is reflected in the prices they are willing to pay in the market and therefore the basis of the producer’s decisions on what goods to produce.

Answer 17

MARKET ECONOMIC SYSTEM

Question 18

also known as the factors of production, are the resources used to produce goods and services. These resources are, by nature, limited and therefore, command a payment that becomes the income of the resource owner.

Answer 18

ECONOMIC RESOURCES

Question 19

Soil and natural resources that are found in nature are not man made. Owners of lands receive a payment known as rent.

Answer 19

LAND

Question 20

Physical and human effort exerted in production. It covers manual workers like construction workers, machine operators and production workers, as well as professionals like nurses, lawyers and doctors. The term also includes jeepney drivers, farmers, and fishermen. The income received by labors is referred to as wage.

Answer 20

LABOR

Question 21

Man-made resources used in the production of goods and services, which includes machineries and equipment. The owner of capital earns an income called interest.

Answer 21

CAPITAL

Question 22

Special skills of an individual needed to produce goods and services like managerial and organizational skills.

Answer 22

ENTREPRENEURIAL ACTIVITY

Question 23

income of an entrepreneur after deducting the payments from the owners of land, labor and capital.

Answer 23

Profit

Question 24

deals with what is – things that are currently happening such as the current inflation rate, the number of employed labors, and the level of the Gross National Product.

Answer 24

Positive Economics

Question 25

refers to what should be – that which embodies the ideal such as the ideal rate of population growth or the most effective tax system.

Answer 25

Normative Economics

Question 26

measures the output of a country's residents regardless of the location of the actual underlying economic activity.

Answer 26

GROSS NATIONAL PRODUCT

Question 27

is the monetary value of all finished goods and services made within a country during a specific period.

Answer 27

GROSS DOMESTIC PRODUCT

Question 28

is an interaction between buyers and sellers of trading or exchange.

Answer 28

market

Question 29

financial market

Answer 29

financial market

Question 29

is the most common type of market because it is where we buy consumers goods.

Answer 29

goods market

Question 29

where the workers offer services and look for jobs, and where employers look for workers to hire.

Answer 29

labor market

Question 30

is the willingness of a consumer to buy a commodity at a given price.

Answer 30

Demand

Question 31

shows the various quantities the consumer is willing to buy at various prices.

Answer 31

demand schedule

Question 32

shows how the quantity demanded of a good depends on its determinants, the most important of which is the price of the goods itself, thus the equation:

Answer 32

demand function

Question 33

is felt when the change in the price of a good changes the consumer's real income or purchasing power

Answer 33

Income effect

Question 34

is felt when a change in the price of a good changes demand due to alternative consumption

Answer 34

Substitution effect

Question 35

all other related variables except those that are being studied in the moment and are held constant, there is an inverse relationship between the price of a good and the quantity demanded for that good.

Answer 35

“ceteris paribus”

Question 36

As price increases, the quantity demanded for that product decreases. The low price of the good motivates the consumer to buy more. When price increases, the quantity demanded for those goods decreases.

Answer 36

The Law of Demand

Question 37

Non-Price Determinants of Demand

Answer 37

✓ Income ✓ Taste ✓ Expectations ✓ Prices of related goods ✓ Population

Question 38

are goods that are used together, such as cell phone or sim card, car and car tires, and coffee and creamer.

Answer 38

Complements

Question 39

increase in the for a good will increase the demand for the complement since they are used together.

Answer 39

Complements

Question 40

goods are those that are used in place of each other, like margarine and butter and artificial sweeteners for sugar.

Answer 40

Substitute

Question 41

When a change in the price of a good causes the quantity demanded for that good to change, this is illustrated on the same demand curve and is a simple movement from one point to another on that curve.

Answer 41

Shifts of the Demand Curve

Question 42

the relationship between a range of prices and the quantities demanded at those prices, as illustrated by a demand curve or a demand schedule.

Answer 42

demand

Question 43

a certain point on the demand curve or one quantity on the demand schedule.

Answer 43

quantity demanded

Question 44

refers to the curve

Answer 44

demand

Question 45

specific point on the curve.

Answer 45

quantity demanded

Question 46

sum of all the individual buyer's demand curves.

Answer 46

market demand

Question 47

states that when the price of a good decreases, it is as if the buyer of the good's income went up.

Answer 47

income effect

Question 48

states that when the price of a good decreases, consumers will substitute away from goods that are relatively more expensive to the cheaper goods

Answer 48

substitution effect

Question 49

are goods that are consumed together.

Answer 49

Complements

Question 50

are goods where you can consume one in place of the other.

Answer 50

Substitutes

Question 51

A schedule or a curve describing all the possible quantities that sellers are willing and able to produce, at all possible prices they might encounter in a particular period of time

Answer 51

SUPPLY

Question 52

As the price of a good goes up. When the price goes down, the amount suppliers are willing to sell goes up, when the price goes down this creates an upward-sloping -

Answer 52

SUPPLY CURVE

Question 53

the amount of a good or service U sellers are willing to sell at a sell at a specific price

Answer 53

Quantity Supplied

Question 54

A movement along a supply curve resulting from a change in a good's price.

Answer 54

Change in quantity supplied

Question 55

A movement or shift in an entire supply curve resulting from a change in one of the non- price determinants of supply.

Answer 55

Change in Supply

Question 56

changes in non-price factors that will cause an entire supply curve to shift (Increasing or decreasing market supply)

Answer 56

Determinants of Supply

Question 57

Changes in production cost and related factors can cause an entire supply curve to shift right or left. This causes a higher or lower quantity to be supplied at a given price

Answer 57

Supply curve shift

Question 58

refers to the quantity of goods that a seller is willing to offer for sale.

Answer 58

Supply

Question 58

shows different quantities the seller is willing to sell at various prices.

Answer 58

Supply schedule

Question 58

Supply curves relate prices and quantities supplied assuming no other factors change

Answer 58

Ceteris Paribus assumption

Question 59

shows the dependence of supply on the various determinants that affect it.

Answer 59

Supply function

Question 60

Non-Price Determinants of Supply

Answer 60

1. Number of Sellers 2. Prices of Resources 3. Taxes and Subsidies 4. Technology 5. Supplier's Expectations 6. Prices of Related Products 7. Prices of Joint Products

Question 60

all other factors being equal, as the price of a good or service increases, the quantity of goods or services that suppliers offer will increase, and vice versa.

Answer 60

Law of Supply