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)
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.
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 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