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Study sets matching "micro"

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Study sets matching "micro"

384 terms
Microeconomics
Economics
Coordination Problem
scarcity
Early economics was based on _________
study of how human beings coordinate their wants and desires…
○ What/how much to produce... ○ How to produce it... For whom to p…
the goods available are too few to satisfy individuals' desires
deduction
Economics
study of how human beings coordinate their wants and desires…
Coordination Problem
○ What/how much to produce... ○ How to produce it... For whom to p…
Microeconomics
Deadweight Loss
Opportunity Cost
Economic Growth
Absolute Advantage
Loss of economic efficiency that can occur when equilibrium f…
The loss of potential gain from other alternatives when one a…
An increase in the amount of goods and services produced per…
Ability of a party to produce a greater good, product or serv…
Deadweight Loss
Loss of economic efficiency that can occur when equilibrium f…
Opportunity Cost
The loss of potential gain from other alternatives when one a…
94 terms
Microeconomics
Economics
Factors of production
Trade off
Marginal rate of substitution (MRS)
is the social science that studies the choices that individua…
Land, capital, labour, entrepreneurship.
an exchange when you give something up to gain something else.
How much of good A you are willing to give up for additional…
Economics
is the social science that studies the choices that individua…
Factors of production
Land, capital, labour, entrepreneurship.
51 terms
Microeconomics
positive economics
normative economics
ceteris parabus
fallacy of false cause
what is true; can be tested against the facts
what should be; requires value judgment
all other things unchanged
assumption that first event must have caused the second
positive economics
what is true; can be tested against the facts
normative economics
what should be; requires value judgment
118 terms
Microeconomics
Principles of Individual Choice
Principles of the Interactions of Indi…
Principles of Market Failure
Principles of Economy Wide Interactions
1. Resources are scarce; therefore, we must make decisions.... 2…
5. There are gains from trade.... 6. Markets will move towards e…
10. Individual actions have side effects that are not taken i…
13. One person's spending is another person's income.... 14. Ove…
Principles of Individual Choice
1. Resources are scarce; therefore, we must make decisions.... 2…
Principles of the Interactions of Indi…
5. There are gains from trade.... 6. Markets will move towards e…
9 terms
Microeconomics
Positive Externality
Negative Externality
Perfect Monopoly
Imperfect Monopoly
A right-shift in the demand curve caused by a faux increase i…
A right shift in the demand curve caused by a faux increase i…
Price taker, must compensate for MR of previous consumers
Price maker, can make larger profit
Positive Externality
A right-shift in the demand curve caused by a faux increase i…
Negative Externality
A right shift in the demand curve caused by a faux increase i…
102 terms
Microeconomics
Private good
Public good
Excludable
non-excludable
good in which a person's consumptionwould take away from anot…
person's consumption does not take away from another person's…
If individuals could be excluded... -movie theater
Individuals could not be excluded... -national defense
Private good
good in which a person's consumptionwould take away from anot…
Public good
person's consumption does not take away from another person's…
33 terms
Microeconomics
Barter
divert
turnpike
ruckus
Exchange goods without involving money.
To turn aside from a course or direction
an expressway on which tolls are collected
a noisy commotion or disturbances
Barter
Exchange goods without involving money.
divert
To turn aside from a course or direction
Microeconomics
Five Foundations of Economics
Production Possibilities Frontier
Shift in Production Possibilities Fron…
Shift in Demand
- Incentives matter... - Life is about trade-offs... - Opportunity…
Goods are equally substitutes
- Technology... - Economic growth... - Natural disasters/war
- Changes in income... - Prices of related goods (substitutes or…
Five Foundations of Economics
- Incentives matter... - Life is about trade-offs... - Opportunity…
Production Possibilities Frontier
Goods are equally substitutes
63 terms
Microeconomics
Total Revenue Formula
Economics
Scarcity
Supply
Price x Quantity ... If a price increase causes an increase in t…
The study of people producing and exchanging scarce resources…
The condition that results because people have limited resour…
the various quantities of a particular good or service a sell…
Total Revenue Formula
Price x Quantity ... If a price increase causes an increase in t…
Economics
The study of people producing and exchanging scarce resources…
99 terms
Microeconomics
Demand
Demand line
Scarcity
Land, natural resources that are used…
the collection of different quantities that people will purch…
represents a downward sloping line reflecting the reality tha…
Having unlimited wants VS having limited resources
factor of production
Demand
the collection of different quantities that people will purch…
Demand line
represents a downward sloping line reflecting the reality tha…
63 terms
Microeconomics
Scarcity
Economics
efficiency
equality
the limited nature of society's resources and therefor cannot…
the study of how society manages its scarce resources
society is getting maximum benefits from its scarce resources
when the benefits of efficiency are equally distributed among…
Scarcity
the limited nature of society's resources and therefor cannot…
Economics
the study of how society manages its scarce resources
74 terms
Microeconomics
Factors of Production
Economic Problem
Opportunity Cost
Economic activity
Capital: refers to goods that are used to produce others good…
We have unlimited wants but only limited resources to satisfy…
The cost of the next best alternative forgone when making a d…
Purpose is to produce goods and services to satisfy consumers…
Factors of Production
Capital: refers to goods that are used to produce others good…
Economic Problem
We have unlimited wants but only limited resources to satisfy…
Microeconomics
The time value of money
Net present Value
Price Elasticity
Adam Smith
You buy a energy efficient refrigerator because in the long r…
The value of a choice taking into consideration the time valu…
is a measure of demand or supply of a good or service to chan…
The intellectual forefather of economics and author of "The W…
The time value of money
You buy a energy efficient refrigerator because in the long r…
Net present Value
The value of a choice taking into consideration the time valu…
55 terms
Microeconomics
Economic perspective
When a competitive market achieves ALL…
From an economist's perspective, an im…
As it relates to the political process…
stresses: ... -resource scarcity and the necessity of making cho…
(right mix of products)... -The combined consumer and producer s…
The marginal cost and marginal benefits of the policies.
inconsistency between voters's interest in programs and polit…
Economic perspective
stresses: ... -resource scarcity and the necessity of making cho…
When a competitive market achieves ALL…
(right mix of products)... -The combined consumer and producer s…
24 terms
Microeconomics
Demand
Supply
Law of demand
Law of supply
The quantity of a product consumers are able and willing to b…
The quantity of a product firms are able and willing to produ…
As the price of a product falls, the quantity demanded of the…
As the price of a product rises, the quantity supplied of the…
Demand
The quantity of a product consumers are able and willing to b…
Supply
The quantity of a product firms are able and willing to produ…
45 terms
Microeconomics
Economics
Microeconomics
Supply and Demand
Opportunity Cost
the study of the efforts to satisfy seemingly unlimited wants…
a part of econ that deals with behavior and decision making b…
the amount of resources you have vs want/need for goods
the next best alternative use of money, time or resources whe…
Economics
the study of the efforts to satisfy seemingly unlimited wants…
Microeconomics
a part of econ that deals with behavior and decision making b…
21 terms
MICROECONOMICS
Law of demand
Determinants of demand
Income (determinant of demand)
Prices of other goods
As demand rises, price increases
Income ... prices of goods... taste and preferences (apple/cancer)…
Normal goods: As income rises, demand will rise ... Inferior goo…
Complements and Substitutes :... Change in price of one will cha…
Law of demand
As demand rises, price increases
Determinants of demand
Income ... prices of goods... taste and preferences (apple/cancer)…
739 terms
microeconomics
The circular flow diagram of economic…
In the circular flow diagram model
In a _______________________, most eco…
_____________ - a term referring to th…
flow of goods, services, and payments between households and…
(both a and b are correct ) ... // ... businesses receive revenues…
market-oriented economy
Economies of scale
The circular flow diagram of economic…
flow of goods, services, and payments between households and…
In the circular flow diagram model
(both a and b are correct ) ... // ... businesses receive revenues…
38 terms
Microeconomics
Microeconomics
Macroeconomics
Positive Statements
Normative statemets
The effect of choices that firms and consumers make under the…
Study of national & global economy
Beliefs... Current operations of the world can be correct or inc…
How things should be
Microeconomics
The effect of choices that firms and consumers make under the…
Macroeconomics
Study of national & global economy
57 terms
Microeconomics
Microeconomics
Circular Flow Diagram
Resources
Goods
Study of individual consumers and businesses.
Diagram that shows how households and firms are related by th…
All things used in producing goods and services
Items purchased to satisfy needs and wants
Microeconomics
Study of individual consumers and businesses.
Circular Flow Diagram
Diagram that shows how households and firms are related by th…
25 terms
Microeconomics
microeconomics
opportunity cost
comparative advantage
absolute advantage
the part of economics concerned with single factors and the e…
the value of the best alternative sacrificed as compared to w…
the ability of a firm or individual to produce goods and/or s…
the ability of a country, individual, company or region to pr…
microeconomics
the part of economics concerned with single factors and the e…
opportunity cost
the value of the best alternative sacrificed as compared to w…
70 terms
Microeconomics
Important Basic Economic Principles
Common Pitfalls
Three questions solved by the economy
Market vs. Centrally planned economy
1. Resources are scarce ... 2. Economic costs are important... - O…
1.Ceteris Parabis: all else held constant... 2. Don't ignore sec…
1. What goods and services will be produced?... 2. How will the…
Market economy is open to free trade. Centrally planned econo…
Important Basic Economic Principles
1. Resources are scarce ... 2. Economic costs are important... - O…
Common Pitfalls
1.Ceteris Parabis: all else held constant... 2. Don't ignore sec…
78 terms
Microeconomics
Scarcity
Economics
Efficiency
Equality
Society has limitless resources and therefore cannot produce…
The study of how society manages its scarce resources
The property of society getting the most it can from its scar…
The property of distributing economic prosperity uniformly am…
Scarcity
Society has limitless resources and therefore cannot produce…
Economics
The study of how society manages its scarce resources
Microeconomics
Total Costs (TC)
AFC
AVC
ATC
TFC + TVC
TFC / Q
TVC / Q
TC / Q or AVC +AFC
Total Costs (TC)
TFC + TVC
AFC
TFC / Q
17 terms
Microeconomics
Inelastic
Elastic
Complementary Goods
Inferior Goods
When the supply or demand for something is insensitive to cha…
When the supply or demand for something sensitive to changes…
A pair of goods where the quantity demanded of one increases…
A good where quantity demanded decreases when consumer income…
Inelastic
When the supply or demand for something is insensitive to cha…
Elastic
When the supply or demand for something sensitive to changes…
162 terms
Microeconomics
Demand
Market
The Law of Demand
Non-price Determinates Of Demand
is the quantities of a good a consumer is willing and able to…
an institution, which permits interaction between buyers and…
there is negative causal relationship between price and quant…
- Income in the case of normal goods ... - Income in the case of…
Demand
is the quantities of a good a consumer is willing and able to…
Market
an institution, which permits interaction between buyers and…
46 terms
Microeconomics
Economics
Your wants are..
3 steps to thinking like an economist
Scarcity and Choice
Wants exceed productive capacity
Unlimited
Scarcity and Choice... Purposeful (Rational) Behavior... Marginal a…
Resources are scarce... Choices must be made... There is no free lu…
Economics
Wants exceed productive capacity
Your wants are..
Unlimited
Microeconomics
Law of Supply
Law of Demand
Demand
Law of Diminishing Marginal Utility
There is a direct relationship between price and quantity sup…
There is an inverse relationship between price and quantity d…
The different quantities of goods that consumers are willing…
The law of diminishing marginal utility states that as you co…
Law of Supply
There is a direct relationship between price and quantity sup…
Law of Demand
There is an inverse relationship between price and quantity d…
61 terms
Microeconomics
Consumer Theory
The theory of firm
Positive Questions/ positive analysis
Normative Questions/ Normative analysis
Describes how customers based on their preferences maximize t…
Firms try to maximize profits
explanation and prediction: statements that describe cause an…
What ought to be: what is best..balancing costs and benefits…
Consumer Theory
Describes how customers based on their preferences maximize t…
The theory of firm
Firms try to maximize profits
24 terms
Microeconomics
Great Economic Problem
Speculation
Free Market Prices Work...
What is a price?
Is to arrange our limited resources to satisfy as many of our…
Is the attempt to profit from future price change
as a signal because through buying & selling, prices come to…
A price is a signaled wrapped up in an incentive because pric…
Great Economic Problem
Is to arrange our limited resources to satisfy as many of our…
Speculation
Is the attempt to profit from future price change
42 terms
Microeconomics
elasticity
inelastic
elastic
minimum wage
how much the demand changes when price goes up or down
you still need the product and will still buy it even if the…
non-essential products that you don't buy when the price goes…
the lowest hourly rate that employers must pay their employees
elasticity
how much the demand changes when price goes up or down
inelastic
you still need the product and will still buy it even if the…
60 terms
microeconomics
the idea that because of scarcity, pro…
the term _____ in economics refers to…
which of the following is a positive e…
the highest value alternative that mus…
trade off
market
if the price of iPhone falls, a larger quantity of iPhones wi…
opportunity cost
the idea that because of scarcity, pro…
trade off
the term _____ in economics refers to…
market
21 terms
Microeconomics
3 main economic agents
scarcity of resources
3 big questions
rational choice / agents
consumers, firms, and governments
limited number of resources
What is to be produced? How is it to be produced? Who should…
Asks the questions: "What is desireable" and "What is feasabl…
3 main economic agents
consumers, firms, and governments
scarcity of resources
limited number of resources
50 terms
Microeconomics
Microeconomics
Circular Flow Diagram
Product Market
Resource Market
Microeconomics is the study of the "smaller picture" of the e…
A diagram of the economy that shows the flow of goods and ser…
In the circular flow, the market in which households purchase…
In the circular flow, this represents the exchange of resourc…
Microeconomics
Microeconomics is the study of the "smaller picture" of the e…
Circular Flow Diagram
A diagram of the economy that shows the flow of goods and ser…
20 terms
MICROECONOMICS
Law of Supply
Factors Shifting Supply Curve
Factors that change Quantity Supplied
Law of Demand
As prices increases, companies will supply more.
Number of sellers, price expectations, change in price of inp…
Price
As prices increases, individuals will demand less.
Law of Supply
As prices increases, companies will supply more.
Factors Shifting Supply Curve
Number of sellers, price expectations, change in price of inp…
30 terms
Microeconomics
product market
resource market
medium of exchange
substitute
in the circular flow chart, households purchase products from…
in the circular flow chart, businesses acquire productive res…
money; something that is generally accepted as payment for go…
something that can be used in place of something else
product market
in the circular flow chart, households purchase products from…
resource market
in the circular flow chart, businesses acquire productive res…
26 terms
Microeconomics
Utility
Marginal Utility
Law of Diminishing Marginal Utility
Budget Constraint
The enjoyment/satisfaction people receive from consuming good…
The change in total utility a person received from consuming…
The principle that consumers experience diminishing additiona…
The limited amount of income available to consumers to spend…
Utility
The enjoyment/satisfaction people receive from consuming good…
Marginal Utility
The change in total utility a person received from consuming…
79 terms
Microeconomics
Which of the following is true if ther…
The incidence of a tax:
Economists identify the satisfaction a…
The demand curve for a monopoly is:
There is a decrease in consumer surplus.
refers to how much of the tax is actually paid by consumers a…
utility.
the industry demand curve.
Which of the following is true if ther…
There is a decrease in consumer surplus.
The incidence of a tax:
refers to how much of the tax is actually paid by consumers a…
24 terms
Microeconomics
Consumer's Surplus
Producer's Surplus
Externality
Production Possibilities Frontier
the difference between the highest price a buyer is willing t…
the difference between the lowest price a seller is willing t…
a benefit or a cost of an activity that affects third parties.
represents the maximum combinations of two goods that an econ…
Consumer's Surplus
the difference between the highest price a buyer is willing t…
Producer's Surplus
the difference between the lowest price a seller is willing t…
20 terms
Microeconomics
First Fundamental Theorem
4 Assumptions of Perfect Competition
Information Asymmetry
Akerlof's Lemon Problem
Competitive markets are the most optimum
1.) Many buyers and sellers. 2.) Perfect information. 3.) Fre…
When one party in a transaction lacks information to make a t…
Quality and uncertainty of what you are buying
First Fundamental Theorem
Competitive markets are the most optimum
4 Assumptions of Perfect Competition
1.) Many buyers and sellers. 2.) Perfect information. 3.) Fre…
44 terms
Microeconomics
Economics
Microeconomics
Macroeconomics
Needs
examine decision making and how limited resources are used to…
is a branch of economics that examines the activities of and…
is a branch of economics that examines the workings and probl…
of individuals or society are goods and services that are req…
Economics
examine decision making and how limited resources are used to…
Microeconomics
is a branch of economics that examines the activities of and…
67 terms
Microeconomics
Opportunity Cost
Positive Statements
Normative Statements
Market
The highest valued option that had to be sacrificed for the o…
Statement about what is (facts); something that can be tested
Statement about what ought to be (opinion)
When consumers and businesses interact
Opportunity Cost
The highest valued option that had to be sacrificed for the o…
Positive Statements
Statement about what is (facts); something that can be tested
22 terms
Microeconomics
Demand
Law of Demand
Determinants of Demand
Law of Diminishing Marginal Benefit
the amount of goods and services that consumers are prepared…
as price increases, quantity demanded decreases... as price decr…
Income... Price of Related Goods... Tastes & Preferences... Future Exp…
the more of a good or service that is available, the less val…
Demand
the amount of goods and services that consumers are prepared…
Law of Demand
as price increases, quantity demanded decreases... as price decr…
46 terms
Microeconomics
Economic Problem
Factors of Production
Land
Labour
- Unlimited wants and needs... - Scarce resources... - Resource use…
- Land... - Labour... - Capital... - Enterprise and Entrepreneurship
All natural resources
Human factor. The physical and mental contribution of the exi…
Economic Problem
- Unlimited wants and needs... - Scarce resources... - Resource use…
Factors of Production
- Land... - Labour... - Capital... - Enterprise and Entrepreneurship
45 terms
Microeconomics
Opportunity Cost
Planned economy
Free market economy
National income
the next best alternative foregone when an economic decision…
an economy in which decisions for what to produce, how to pro…
an economy in which decisions for what to produce, how to pro…
value of all goods and services produced in an economy in a g…
Opportunity Cost
the next best alternative foregone when an economic decision…
Planned economy
an economy in which decisions for what to produce, how to pro…
127 terms
Microeconomics
In determining whether and how much of…
Suppose a certain good provides an ext…
Government agencies, such as the Natio…
A budget deficit occurs when governmen…
False
True
True
False
In determining whether and how much of…
False
Suppose a certain good provides an ext…
True
29 terms
Microeconomics
Labor Supply Curve
Midpoint Formula
Budget Constraint
Perfect Knowledge
Shows labor supplied at different wages rates
more precise way of calculating percentages using halfway val…
Limit imposed on choices by income, wealth and product prices
Households and firms have complete information necessary to m…
Labor Supply Curve
Shows labor supplied at different wages rates
Midpoint Formula
more precise way of calculating percentages using halfway val…
Microeconomics
scarcity
economics
opportunity cost
market failure
the limited nature of societies resources
the study of how society manages its scarce resources
whatever must be given up to obtain something
a situation in which a market left on its own fails to alloca…
scarcity
the limited nature of societies resources
economics
the study of how society manages its scarce resources
Microeconomics
Market Equilibrium
Surplus
Shortage
What factors determine elasticity for…
a condition of price stability where the quantity demanded eq…
when the quantity supplied is greater than the quantity deman…
occurs when the quantity demanded is greater than the quantit…
The way consumers respond to the change in price
Market Equilibrium
a condition of price stability where the quantity demanded eq…
Surplus
when the quantity supplied is greater than the quantity deman…
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