ECON FINAL

An increase in the demand for computers and a decrease in the number of sellers of computers will​ ________.
Click the card to flip 👆
1 / 42
Terms in this set (42)
An increase in the demand for computers and a decrease in the number of sellers of computers will​ ________.
increase the price of a computer
At one point along a PPF 40 tons of wheat are produced while 80 tons of rice are produced. At another point along the same PPF​, 41 tons of wheat are produced while 70 tons of rice are produced. The opportunity cost of producing a ton of wheat between these points is​ ________ per ton of wheat.
10 tons of rice
Homer and Teddy are stranded on a desert island. To feed themselves each day they can either catch fish or pick fruit. In a​ day, Teddy could pick 60 pieces of fruit or catch 20 fish. Homer could pick 100 pieces of fruit or catch 150 fish. Which of the following statements is​ correct?
Homer has an absolute advantage in both catching fish and picking fruit.
If Geoffrey and Hermione devote equal amounts of time and effort to making​ pretzels, Geoffrey produces more units than Hermione. This information tells us that
Geoffrey has an absolute advantage in producing pretzels.
Consider the market for broccoli. If the price of a pound of broccoli​ increases, what happens to the supply of​ broccoli?
There will be no change in the supply of​ broccoli, but instead is an increase in the quantity supplied of broccoli.
As Johnnys income increases, his demand for potato chips decreases.
what type of good are potato chips for johnny?
an inferior good.
Martha can produce 90 quilts or 180 batches of chocolate chip cookies in a month.
Jane can produce 6 quilts or 18 batches of chocolate chip cookies in a month.
Distinguish between comparative advantage and absolute advantage.

​_______ has an absolute advantage in producing both goods.

​_______ has a comparative advantage in producing quilts.​ _______ has a comparative advantage in producing chocolate chip cookies.
Martha , and Martha Jane
If the demand curve for bottled water shifts rightward and the supply curve of bottled water shifts​ leftward, the equilibrium
price of bottled water definitely increases.
If the price of a game console decreases​, how does the demand for games
change?

If the price of a game console decreases​, the demand for games will​...
increase​, and the demand curve for games will shift rightward
Which of the following always raises the equilibrium​ price?
an increase in demand combined with a decrease in supply
Russell studies instead of playing tennis. The opportunity cost to him of studying isthe forgone value of playing tennis.If demand increases and supply​ decreases, what is the effect on equilibrium price and equilibrium​ quantity?The price rises and the quantity might​ increase, decrease or remain the same.A decrease in the price of wood planks​, a complement in production of saw dust​, will​_______ the equilibrium price of saw dust and​_______ the equilibrium quantity of saw dust.increase, decreaseIn an​ hour, Simon can catch 4 pounds of tuna or pick 8 pounds of peaches. In an​ hour, Zeb can catch 4 pounds of tuna or pick 20 pounds of peaches. The opportunity cost of catching a pound of tuna is​ _______ for Simon than for Zeb​, and the opportunity cost of picking a pound of peaches is​ _______ for Simon than for Zeb. So​ _______ has a comparative advantage in producing​ _______.1. lower, higher 2. Simon, tunaJohnny graduates from college and his income increases by ​$40,000 a year. Nothing else changes. Johnny decreases the quantity of ketchup and pizza that he buys and increases the quantity of coffee that he buys. How can we categorize Johnny​'s ​purchases?Coffee is a normal goodHarry produces 3 balloon rides and 6 boat rides an hour. Harry could produce more balloon rides without producing fewer boat rides. Is Harry producing on his production possibilities​ frontier?Producing insideWhich does not match?Capital; profitConsider gardening books. What will happen to the market for these books as gardening becomes more popular and simultaneously printing costs​ increase?The price of gardening books definitely increases.Social interestthe choices that are best for society as a whole. Example I am collecting funds to help flood victims.self-interestThat which each firm, property owner, worker, and consumer believes is best for itself and seeks to obtain. Example I buy pizza for lunch.efficient outcomewhen an allocation of resources maximizes total surplusWhat, how, and from whom factorwhat goods and services do we​ produce, how do we use the factors of production to produce these​ goods, and who consumes the goods and services that are producedSocial interest exampleCigarets must put a warning a label on the packaging4 factors of production.​land, labor,​ capital, and entrepreneurshipTrade-offan alternative that we sacrifice when we make a decisionrational choicechoosing the alternative that has the greatest value from among comparable-quality productsA choice on the margin is.. Marginal cost- Marginal benefit-Alternatives systematically and incrementally Marginal cost is the​ opportunity cost that arises from one unit​ increase in an activity. Marginal benefit is the​ benefit that arises from one unit​ increase in an activity.​Pam, Pru, and Pat are deciding how they will celebrate the New Year. Pam prefers to go on a​ cruise, is happy to go to​ Hawaii, but does not want to go skiing. Pru prefers to go​ skiing, is happy to go to​ Hawaii, but does not want to go on a cruise. Pat prefers to go to Hawaii or to take a cruise but does not want to go skiing.Pam, Pru, and Pat all face trade offs.oportunity costCost of the next best alternative use of money, time, or resources when a choice is made.how to calculate opportunity cost. If you​ do, you​ won't be able to take your usual summer job that pays ​$10,000 for the​ summer, and you​ won't be able to live at home for free. The cost of transportation is ​$1,000​, visas cost ​$200​, and living expenses are ​$1,200. What is the opportunity cost of your plan to travel in​ Europe?Add all the numbers together for your final opportunity cost. $12,400​Hanssan a medical student, buys three cups of coffee a​ day, which costs him ​$7.50. He decides to buy one more cup each day and his expenditure on coffee increases to ​$10.00. What is Hassan​'s marginal cost of a cup of​ coffee?$2.50. $10.00 - $7.50 = $2.50An economic model is a description of some features of the economic world that includes​ _____ features assumed necessary to explain the​ _____ facts.only those; observedeconomic modelsimplified version of a complex concept or behavior expressed in the form of a graph, figure, equation, or diagram. An example of one is a weather map.How is economics used as a policy​ tool?model different economic proposals proposed by governmentNormative versus positive statementsNormative are opinion based example, every household should have a dog, Positive is factual and can be proved. Covid is higher in the US than in Canada.What do economist do?the collection and analysis of​ data, the ability to predict future​ trends, and study to determine ways of using resources more efficientlyAverage salary of an economist$56,500 to​ $139,600; ​$105,100production possibilities frontierthe boundary between the combinations of goods and services that​ can be produced and the combinations that cannot be produced given the available factors of production and the state of technology.Production efficiencyis a situation in which the economy is getting all that it can from its resources and​ cannot produce more of one good or service without producing​ less of something else.To increase the money​ supply, the Fed canconduct open market purchases of government bonds.An open market purchase of securities by the Fedincreases​ banks' reserves and decreases​ banks' securities.The crowding out effect refers togovernment investment crowding out private investment