Economics BA Flashcards
How do labor unions impact competitive markets?
Cost of labor
How do large stores affect mom and pops stores?
Economies of sales
How do consumers keep the markets competitive?
Low cost products
What does an increase in price lead to?
Increased profits
What are incentives to attract buyers?
Equals lower prices for consumers
What causes an increase for hybrid cares?
High oil/gas costs
Why will a business pay for an employees education?
To increase their output
Why did GM invest in new technology?
To increase efficiency
When a business invests in physical capital, what will others do?
It will force others to stay competitive
What happens when production costs go down?
Supply will increase
What happens if raw material prices increase?
It will lead to a decrease of supply
What is the law of supply?
Quantity of goods supplied is greater at a high price than at a lower price
What is the law of demand?
Consumers will purchase more at lower prices
What is an example of substitution?
When the cost of pizza increases, people will buy more hot dogs
What is the elasticity of demand for insulin?
Change in price will not affect the demand
What concept explains the price of hamburger and demand for hamburger buns?
Complementary goods
What government policy will cause an increase in demand for windows?
Tax incentives for home improvement
What is the role of the US government?
Protect the property rights of individuals and businesses
How does the government protect consumers?
Health and safety standard for goods and services
What is equilibrium?
Where supply and demand meet on a graph
What does an increase in consumers equal
Increase in demand
What is the advantage of a command economy?
Full employment
What is an advantage of a market economy?
Efficiency
What is a statement Karl Marx would agree with?
One will live according to their ability and to their need.
What economic system will answer the needs of the consumer?
Market/mixed
What happens in a command economy?
Shortages
Why is the US a mixed economy?
Both market and command (government rules)
What flows from a business to a consumer?
Resources = end product
Factor market
Labor goes to business
What would happen if the population of the US increases?
Labor flow to business will also decrease
