Finals Flashcards
1 factor
Factor of production: land
3 capital
Physical capital and human capital
4 resource
Entrepreneurship
Comparative advantage
the ability of an individual or group to carry out a particular economic activity (such as making a specific product) more efficiently than another activity.
Absolute advantage
the ability of an individual or group to carry out a particular economic activity more efficiently than another individual or group.
Total revenue
Price x quantity
Factors of inelastic
Few substitutes
Necessity
Inexpensive
Total revenue goes up
Factors of elastic
Many substitutes
Luxury
Expensive
Total revenue goes down
When price goes up, revenue ______
Goes down
Elasticity formula
Change in price divided by price x 100
Elastic formula
ED>1
Inelastic formula
Ed
Loss
ATC>p
Profit
ATC<p></p>
If the price of a good rises
Quantity demanded will decrease
The supply of a good or service is determined by
Those who sell the good or service
An upward sloping supply curve for a firm shows us
The increasing costs associated with producing more of a product
Economics
The study of the allocation of scarce resources
Which of the following determinants would not cause a shift in supply?
Number of buyers
If the price of a good rises
Quantity demanded decreases
Average total cost dropping means
Economies of scale
When a firm experiences constant returns to scale
Long run average total cost does not change as output increases
Explicit costs:
Require spending money
Implicit costs:
Are all opportunity costs
Finding TVC
AVC x Q
