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Art - Music - Economics > economics 151-225 > Flashcards

economics 151-225 Flashcards

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1
Q

what happens to the equilibrium price of a good if there is an increase in demand ceteris paribus

A

the price increases

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2
Q

what is the market supply of a good

A

the sum of individual supply for each supplier in a market

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3
Q

what happens to the exchange quantity of a good if there is an increase in supply ceteris paribus

A

the exchange quantity increases

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4
Q

what is the market clearing price of a good

A

the equilibrium price

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5
Q

the upward slope of the supply curve is explained by the law of increasing marginal…

A

cost

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6
Q

you can sell 10 hockey pucks at $5 each or 9 hockey pucks at $6 each. Calculate the PED

A

10% change in quantity demanded/20% change in price PED=1/2=.5

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7
Q

income elasticity of demand measures…

A

responsiveness of demand to consumer income

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8
Q

cross elasticity of demand measures

A

responsiveness of demand for a good to the price of complimentary and substitute goods

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9
Q

if price elasticity of demand is equal to one, the demand is…

A

unit elastic

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10
Q

if price elasticity of demand is equal to zero, then demand is…

A

this

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11
Q

what is the most important resource market in the us

A

the labor market

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12
Q

how do most economists feels about free trade

A

most economists support free trade

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13
Q

what happens to the total consumption possibilities for two nations that specialize according to their comparative advantages and then trade

A

total possible consumption increases

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14
Q

what is barter

A

the exchange of resources goods or services without using money

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15
Q

how did japan achieve rapid economic growth in the 1970s and 1980s

A

by training its workforce well and by applying technology

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16
Q

what do we use to avoid the inefficiency of a barter system

A

money or any other medium of exchange

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17
Q

what is a market

A

a mechanism that brings buyers and seller together for the purpose of making an exchange

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18
Q

what is division of labor

A

the act of dividing the production of a good into simple separate tasks

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19
Q

what is fiat money

A

a form of money that is only valuable as a medium of exchange not as a commodity and only because people believe the issuing government can back its value

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20
Q

what kind of money s paper currency

A

fiat money

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21
Q

what happens to the quantity demanded of a good as the price increases

A

quantity demanded decreases

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22
Q

what happens to the equilibrium price of a good if there is an increase in supply, ceteris paribus

A

the price decreases

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23
Q

what is demand

A

the relationship between the price of a good and the quantity of it that consumers are willing and able to buy

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24
Q

how is quantity supplied related to supply

A

supply is the quantity supplied at each possible price within a range of prices

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25
Q

what happens to exchange quantity if there is a simultaneous increase in demand and decrease in supply

A

we cannot tell exactly

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26
Q

what happens to the quantity demanded of a good as the price decreases

A

quantity demanded increases

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27
Q

why is the equilibrium price of a good sometimes called the market clearing price

A

because when there is an equal number of buyers and sellers, the market is said to clear

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28
Q

what happens to the equilibrium price of a good if there is a decrease in demand, ceteris paribus

A

the price decreases

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29
Q

what is quantity demanded

A

the quantity of a good that consumers are willing and able to buy at a particular price

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30
Q

what are of economics explores the individuals preference for a particular good

A

microeconomics

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31
Q

what is the term for a situation in which resources, goods, or services are exchanged

A

market

32
Q

how are two boys trading baseball cards an example of a market

A

they are exchanging goods

33
Q

what happens to equilibrium price when there is a simultaneous decrease in demand and increase in supply

A

equilibrium price decreases

34
Q

what happens to equilibrium price if there is a simultaneous increase in both supply and demand

A

we cannot tell oops

35
Q

what is the equilibrium quantity of a good or service

A

the quantity at which sellers ask the price that buyers are willing to spend

36
Q

what happens to equilibrium price if there is a simultaneous increase in demand and decrease in supply

A

equilibrium price increases

37
Q

what area of economics explores the behavior of individual producers and consumers

A

microeconomics

38
Q

what happens to exchange quantity if there is a decrease in supply

A

exchange quantity decreases

39
Q

what area of economics explores the components and behaviors of individual markets

A

microeconomics

40
Q

how does a market system eliminate the need for buyers and sellers to negotiate over every individual change

A

with a price system

41
Q

what is individual supply of a good

A

the supply of an individual producer

42
Q

what is individual demand

A

the demand of one consumer for a good

43
Q

quantity supplied increases as price increases because higher prices provide a (positive/ negative) incentive for producers

A

positive

44
Q

if five dollars are worth two franc, then the ____ rate is 2.5 to 1

A

exchange

45
Q

specialization in trade result in (increased/decreased) production

A

increased

46
Q

when people specialize, how do they satisfy their wants and needs for goods and services they do not produce?

A

trade

47
Q

specialization (increased /decreases) efficiency

A

increases

48
Q

specialization (increases /decreases) dependence on the self-intrest of others.

A

they become interdependent

49
Q

when individuals specialize, what must they do to satisfy their wants

A

trade

50
Q

are the workers in an assembly line independent or interdependent?

A

interdependent

51
Q

what term refers to any situation in which goods, services, or resources are exchanged?

A

a market

52
Q

trading is simpler with money than with a better system because bartering requires a “double _____ of wants”

A

coincidence

53
Q

what is the economic term for goods that are produced in a foreign country and purchased by domestic consumers?

A

imports

54
Q

people tend to specialize in goods in which they have (an absolute advantage/a comparative advantage)

A

a comparative advantage

55
Q

tim can write more flashcards per hour than sam can. Does tim have an absolute or a comparative advantage in flashcards?

A

Absolute (he many have a comparative advantage as well, but there is not enough information in the question to determine this)

56
Q

Specialization and trade result in (increased/decreased) consumption

A

increased

57
Q

specialization leads to (interdependence/independence)

A

interdependence

58
Q

what is required for specialization to occur?

A

voluntary exchange

59
Q

who experiences a greater level of interdependence: “jack-of-all-trades” or a specialist?

A

specialist

60
Q

which is likely to require the most education and skill: division of labor or specialization?

A

specialization

61
Q

what component of a market economy allows producers to specialize?

A

voluntary exchange

62
Q

producers tend to specialize in the good or service that they can produce at the lowest _____ cost

A

opportunity

63
Q

what is the economic term for good that are produced domestically and sold to consumers in another country

A

exports

64
Q

t/f: barter requires fewer transactions than trade with the use of money?

A

TRUE

65
Q

What is the term for the unique type of specialization that occurs in an assembly line?

A

division of labor

66
Q

international trade occurs when one country produces a product and (imports/exports) it to another country

A

exports

67
Q

What is required for voluntary exchange to occur?

A

al participating parties must expect to benefit from the exchange

68
Q

t/f: people desire money for its intrinsic value.

A

FALSE

69
Q

tariffs and quotas are examples of barriers to _____.

A

trade

70
Q

what term refers to the trade of one good directly for another, without the use of money?

A

barter

71
Q

A negative cross elasticity of demand tells us that two goods are (complements/substitutes).

A

complements

72
Q

A positive cross elasticity of demand tells us that two goods are (complements/substitutes).

A

substitutes

73
Q

Ticket prices go up at Clippers games, and overall ticket revenue increases at the Staples Center. This means that demand in this price range is _____.

A

inelastic

74
Q

Prices increase on Daewoo automobiles, and quantity demanded plunges to zero. Demand in this price range is _____.

A

perfectly elastic

75
Q

”% change in quantity divided by % change in price” is the generic formula for ________.

A

price elasticity of demand

Art - Music - Economics (34 decks)

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