Econ Test 3 Flashcards
WE GOT THISSSSSSSSSSSSSSSsss
What type of a good is a truck used by a florist to deliver flowers?
Capital
Which group favored a natural economy?
Physiocrats
If Gordon accounting business had expenses = 90k and revenues totaling 115k last year but he could have had a salary of 80k working for someone else what was his opportunity cost.
55k
What states that when the price of a good falls consumers tend to buy more of that good.
Income Effect
What type good does not last more than 3 years.
Non-Durable Good
What type of good is directly related to a consumers income?
Normal Good
What type of economic system is controlled by a centralized authority?
Command
What type of economic system is based upon custom heredity and cast?
Traditional
Besides limited gov. And freedom of enterprise and competition to what does the free market economy owe it’s proficiency?
Property Rights
What is a group of firms that produce similar products or provide similar services?
Industry
What is the American automobile industry an example of?
Oligopoly
What is the retail clothing industry in a large city an example of?
Monopolistic Competition
Adam Smith
Invisible Hand
Carl Menger
Diamond Water Paradox
E.I. DuPont
Gunpowder Entrepreneur
David Recardo
Comparative Advantage
Henry Ford
Mass Production
Pierre Samuel DuPont
Physiocracy
What is the study of the choices that individuals and societies make in production distribution and consumption of goods?
Economics
What are the four factors of production?
-Labor
-Entrepreneurship
-Natural Resources
-Capital
What is the name of Adam Smiths most famous book?
“The Wealth of Nations”
What is a list of numbers that compares price with quantity demanded?
Demand Schedule
If firm A can produce 50 shoes or 40 coats with the same amount of resources from which firm B can produce 45 coats or 65 shoes, which firm has the comparative advantage in coats?
Firm A
What governmental agency investigates trade practices?
FTC (Federal Trade Commission)
What was the first act implemented in 1890 to regulate monopolistic trusts?
Sherman Act
What antitrust act was passed in 1914 that addressed practices not addressed in earlier laws?
Clayton Act
What 3 things is mass production based on?
Division of Labor, Standardized Parts, and Automatic Conveyance
What is the production of goods in which a country or region has absolute or comparative advantage?
Geographic Specialization
What makes possible a better standard living for everyone in prosperous society?
Competition
What do consumers send to producers to let them know what foods are whited at what prices?
Market Signals
What term deals with the study of specific components within a major economy?
Micro-Economics
What is an illegal system developed to avoid governmental regulations?
Black Market
What is the exchange of goods in the absence of governmental restrictions or penalties?
Free Trade
Tax on imported goods.
Tariffs
Amount of satisfaction resulting from a one unit increase of a product.
Marginal Utility
Total amount invested in the production of a good.
Input
Total value of a business minus any liabilities.
Equity
Value of the best alternative that is foregone when a different alternative is taken.
Opportunity Cost
The place at which quantity demanded and quantity supplied are equal.
Equilibrium
Forces the consumer to buy certain products before he is able to buy what he really wants.
Tying Contract
Excess of the total revenue paid by buyers for gods over the seller’s total expense of producing those goods.
Profit
Total amount of satisfaction received from a particular amount of some good.
Total Utility
(T or F) One way to improve efficiency is to keep output constant and INCREASE input.
Decrease
(T or F) When the demand for a good increases, the good’s equilibrium price tends to INCREASE.
True
(T or F) If the supply of tennis rackets increased while the demand remained steady, stores would likely INCREASE the prices of rackets.
Decrease
(T or F) The value of a good varies according to its utility and its SCARCITY.
True
(T or F) ABSOLUTE advantage is the ability of an entity to produce a good or provide a service at an opportunity cost that is lower than that of another producer.
Comparative
(T or F) The TOTAL cost is the sum cost of all the factors of production used in making goods
True
(T or F) A NATURAL monopoly occurs when a single firm can fill the demand for a good more efficiently.
True
(T or F) A SERVICE is a tangible item for which people will pay.
Good
(T or F) A CONSUMER is an individual who provides goods.
Producer
(T or F) SUPPLY is the relationship between a good’s priced and the amount that producers are willing to make available.
True
(T or F) PROFICIENCY is the quality of producing effectively with a minimum of waste.
Efficiency
(T or F) The result of a price ceiling would be a SHORTAGE.
True
(T or F) A failing business should continue production as long as total revenue exceeds VARIABLE costs.
Fixed
(T or F) A decrease in the DEMAND for workers is caused by increased wages.
True
(T or F) A ppc bending INWARD signifies that two goods are best produced in moderation with each other.
Outward
(T or F) A CONSERVATIVE economic philosophy seeks full employment over economic growth and stability.
Liberal
Blocked entry to market.
Monopoly
Produce a standardized product.
Perfect Competition
Few firms in entire industry.
Oligopoly
Significant entry barriers.
Oligopolies
Large number of firms.
Monopolistic Competition
No close substitutes for firm’s products.
Monopolies
Large number of independent buyers and sellers.
Perfect Competition
Sole supplier of a good or service.
Monopoly
Total amount of a good produced.
Output
ESSAY: Since businesses see monopolies and collaborating oligopolies as economically appealing why are they rare in a country with a free market.
Freedom for firms
If only a few new firms would be attracted to market and attempt to grow with better quality. (Consumer choice, Competition, and Government Regulation.)
