Brainscape's Knowledge GenomeTM

Browse over 1 million classes created by top students, professors, publishers, and experts.


See full index

Econmics > Economics Year 1 Topic 1 > Flashcards

Economics Year 1 Topic 1 Flashcards

1
Q

asymmetric information

A

One party knows more than the other in a transaction creating an unfair advantage

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
2
Q

Information failure

A

When both people in an exchange don’t have the correct or enough knowledge to make a decision

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
3
Q

Moral Hazard

A

Econmic agents makes a decision in their own interest knowing risks that could harm others

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
4
Q

principal-agent problem

A

Principal employs an agent to perform duty’s that conflict with the agents interests

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
5
Q

imperfect information

A

Where both buyers and sellers or either or lack information to make a informed decision

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
6
Q

Market failure

A

Where there is too much demand for too little supply or too little demand for too much supply

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
7
Q

Normative statement

A

A statement which cannot be supported because it’s a value of judgement

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
8
Q

Positive statement

A

A statement that can be supported by evidence

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
9
Q

positive economics

A

Study of allocation of resources

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
10
Q

Model

A

A hypothesis which is refutable by empirical evidence

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
11
Q

Ceteris Paribus

A

all things being equal

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
12
Q

normative economics

A

The study of which scarce resources are allocated

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
13
Q

Economic Problem

A

Unlimited wants to scarce recourses

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
14
Q

Law

A

A model which has been verified by empirical evidence

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
15
Q

Capital

A

As a factor of production, the stock of manufactured resources used in the production of goods and services

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
16
Q

Labour

A

as a factor of production is the workforce

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
17
Q

Land

A

as a factor of production, is all natural resources

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
18
Q

oppertunity cost

A

the value of the best alternative not chosen

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
19
Q

factors of production

A

Land, labor, and capital; the three groups of resources that are used to make all goods and services

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
20
Q

Entrepreneurs

A

individuals who seek out profitable opportunities for production and take risks in attempting to exploit these

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
21
Q

barter

A

Exchange goods without involving money.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
22
Q

division of labor

A

Specialisation by workers, that preform different tasks at different stages to become more effective

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
23
Q

primary sector

A

Extractive and agricultural industries

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
24
Q

private sector

A

the part of the economy that is owned by individuals

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
25
Q

Productivity

A

Output per unit of input employed

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
26
Q

Public sector

A

The part of the economy where production is organised by the state or goverment

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
27
Q

Tertiary sector

A

Industry’s involved in the production of services

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
28
Q

Macroeconomics

A

The study of economics as a whole

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
29
Q

Microeconomics

A

The study of individuals behaviours

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
30
Q

total utility

A

the amount of satisfaction a person derives from the total amount of a product consumed

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
31
Q

marginal utility

A

The additional satisfaction a person derives from the total amount of product consumed

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
32
Q

Market

A

A place where buyers and sellers meet and goods and services are exchanged

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
33
Q

Prices causes what in a graph?

A

Movement

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
34
Q

A change in Demand and supply causes what in a graph

A

Shift

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
35
Q

Equilibrium

A

A balance between concepts

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
36
Q

External benefit

A

An action someone does that benefits a third party (non involved)

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
37
Q

Price signals

A

The information that markets generate to guide the distribution of resources

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
38
Q

unintended consequences

A

This is where government intervention creates unintended consequences

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
39
Q

Excessive admin costs

A

The cost of correcting market failure outweighs the benefits

40
Q

Information gaps

A

When a government doesn’t have enough information to make a decision. Or the information can be misleading

41
Q

Conflicting objectives

A

This is where government want multiple things however doing one eliminates the chance of doing another

42
Q

Politicians maximising their own welfare

A

Politicians suggesting polices that benefit themselves selves over the citizens

43
Q

Market failure

A

When resources are inefficiently allocated

44
Q

government failure

A

occurs when government intervention leads to a net welfare loss compared to the free market solution

45
Q

Public choice theory

A

theories about how and why public spending and taxation decisions are made

46
Q

rent seeking

A

using political influence to increase one’s economic profits at the expense of others

47
Q

consumer surplus

A

the amount a buyer is willing to pay for a good minus the amount the buyer actually pays for it

48
Q

producer surplus

A

The difference between the market price which firms receive and the price at which they are prepared to supply

49
Q

Incentive function of the price mechanism

A

when changes in price encourage buyers and sellers to change the quantity they buy and sell

50
Q

Rationing function of the price mechanism

A

When changes in price lead to more or less being produced, so increasing or limiting the quantity demanded by buyers

51
Q

Signalling function of the price mechanism

A

When changes in price give information to buyers and sellers which influence their decisions to buy and sell

52
Q

medium of exchange (functions of money)

A

Allows goods and services to be exchanged without double convenience of wants

53
Q

standard of deferred payment (functions of money)

A

Paying for something in the future

54
Q

A store of value (functions of money)

A

Can be saved and used in the future

55
Q

Unit of account (function of money)

A

Comparison of goods and services

56
Q

Ad valorem

A

tax is that it is proportional to the value of the underlying asset

57
Q

Specific tax

A

tax that is given as a fixed rate for each unit of a good or service

58
Q

Productive efficiency

A

Production takes place at lowest cost

59
Q

Allocatively efficient

A

occurs when social welfare is maximised

60
Q

Private cost or benefit

A

The cost or benefit of a action to firms or consumers

61
Q

Negative externality

A

If net social cost is greater then net private cost

62
Q

Positive externality

A

If net social benefit is greater then net private benefit

63
Q

Social cost or benefit

A

The cost or benefit of an activity to socity

64
Q

Specialisation

A

Concentrating on producing certain goods and services and becoming more efficient

65
Q

Social cost

A

Private cost + external cost

66
Q

Negative externalities (welfare loss triangle)
Direction

A

Facing right

67
Q

Positive externalities (welfare loss triangle)
Direction

A

Facing left

68
Q

Non-rivalrous

A

No limit to the amount of people consuming the good

69
Q

Non-excludable

A

Cannot stop a person or group using good

70
Q

Free rider problem

A

Someone using a public good without contributing or not contributing enough

71
Q

Pure public good

A

Non rivalrous and non excludable (traffic lights)

72
Q

Symmetrical information

A

Both party’s in a transaction have the same level of knowledge

73
Q

Changes in demand
-PASIFIC

A

-Population
-advertising
-season
-income
-fashion
-Interest
-competition

74
Q

Changes in supply
-PINTS WC

A

-productivity
-indirect taxes
-no of firms in the market
-Technology
-subsides

75
Q

PED

A

%change in demand
——————————
%change in price

76
Q

PES

A

%change in supply
—————————
%change in price

77
Q

XED

A

%change in quantity in demand for good A
———————————
%change in price of good B

78
Q

YED

A

%change in demand
—————————-
%change in income

79
Q

Inferior goods

A

Income goes up demand falls
Negative YED

80
Q

Normal goods

A

Income goes up so does demand
(Positive YED)

81
Q

Luxury

A

YED of greater then 1

82
Q

Necessities

A

YED of less then 1

83
Q

AD formula

A

C+I+G+(X-M)

84
Q

Consumption on a graph

A

DOWN

85
Q

Production on a graph

A

UP

86
Q

Substitute

A

Positive XED

87
Q

Complement

A

Negative XED

88
Q

Command economy

A

-Most resources are allocated by the state, the market has little to no part to play

89
Q

Mixed economies

A

-More resources are allocated though state planning then in free market economies

90
Q

Free market economies

A

-The majority of resources are allocated through markets then the state

91
Q

Changes in PED - SPLAT

A

-substitutions
-proportion of Y
-luxury
-addictive
-time

92
Q

Changes in PES- PSSST B

A

-production lag
-stock
-spare capacity
-substitute ability if the factors of production
-technology
-barriers to entry

93
Q

Interest rate

A

How much credit costs when borrowing from a bank

94
Q

Balanced government budget

A

When government receipts are the same as government spending

95
Q

Hysteresis unemployment

A

The longer you’ve been unemployed the less likely you are to get back into work

96
Q

State provision

A

Direct provision of goods and services by the government free at the point of consumption

Econmics (5 decks)

Brainscape helps you reach your goals faster, through stronger study habits.
© 2024 Bold Learning Solutions. Terms and Conditions