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Study sets matching "microeconomics 3"

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Study sets matching "microeconomics 3"

29 terms
Microeconomics 3
Full employment
Unemployment (not fully efficient)
Demand
Demand Conditions (Peoples wants)
What does the blue line mean in the image?
If the point is in the yellow, what is it?
What factor does a Production Possibility Frontier leave out?
What information on the Production Possibilities Frontier wou…
Full employment
What does the blue line mean in the image?
Unemployment (not fully efficient)
If the point is in the yellow, what is it?
25 terms
Microeconomics 3
Competitive Market
Money Price
Relative Price
Quantity demanded
A market that has many buyers and many sellers, so no single…
The price of an object is the number of dollars that must be…
The ratio of one price to another
the amount that consumers plan to buy during a given time per…
Competitive Market
A market that has many buyers and many sellers, so no single…
Money Price
The price of an object is the number of dollars that must be…
20 terms
Microeconomics3
market
competitive market
quantity demanded
law of demand
a group of buyers and sellers of a particular good or service
a market in which there are many buyers and many sellers so t…
the amount of a good that buyers are willing and able to purc…
the claim that, other things being equal, the quantity demand…
market
a group of buyers and sellers of a particular good or service
competitive market
a market in which there are many buyers and many sellers so t…
21 terms
Microeconomics 3
a market in which a single seller prod…
a market in which one producer can pro…
competition based not on price but on…
the minimum payment required for entre…
monopoly
natural monopoly
nonprice competition
normal profit
a market in which a single seller prod…
monopoly
a market in which one producer can pro…
natural monopoly
64 terms
Microeconomics 3
CHAPTER 12
Total Revenue
Total cost
Profit
THE COSTS OF PRODUCTION
The amount that a firm receives from the sale of goods and se…
The amount that a firm pays for all of the inputs that go int…
The difference between total revenue and total cost
CHAPTER 12
THE COSTS OF PRODUCTION
Total Revenue
The amount that a firm receives from the sale of goods and se…
38 terms
microeconomics 3
market work
nonmarket work
leisure
substitute effect of a wage increase
time sold as labor... -Marx and Engels
time spent getting an education or producing goods and servic…
time spent on nonwork activities
a higher wage encourages more work because other activities n…
market work
time sold as labor... -Marx and Engels
nonmarket work
time spent getting an education or producing goods and servic…
12 terms
Microeconomics 3
Factor Market
Product Market
Supply
Demand
any place where factors of production are brought and sold
any place where finished goods and services are bought and sold
ability and willingness to sell specific quantities of a good…
ability and willingness to buy specific quantities of a goods…
Factor Market
any place where factors of production are brought and sold
Product Market
any place where finished goods and services are bought and sold
93 terms
Microeconomics 3
An extreme market structure with a sin…
Monopolies arise _________ and through…
Who are price makers?
Monopolists produce at the point where
Monopoly
natural ; government protection
Monopolists
marginal revenue equals marginal cost
An extreme market structure with a sin…
Monopoly
Monopolies arise _________ and through…
natural ; government protection
30 terms
Microeconomics 3
Efficient
deadweight loss
explicit costs
accounting profit
a situation is efficient if no change is possible that will h…
the reduction in total economic surplus that results from the…
the actual payments a firm makes to its factors of production…
the difference between a firm's total revenue and its explici…
Efficient
a situation is efficient if no change is possible that will h…
deadweight loss
the reduction in total economic surplus that results from the…
31 terms
Microeconomics 3
Labor Union
Craft Union
Industrial Union
Backward-Bending Supply Curve of Labor
A group of workers who organize to improve their terms of emp…
A union whose members have particular skill or work at a part…
A union of both skilled and unskilled workers from a particul…
as the wage rises, the quantity of labor supplied may eventua…
Labor Union
A group of workers who organize to improve their terms of emp…
Craft Union
A union whose members have particular skill or work at a part…
39 terms
microeconomics 3
substitution effect
income effect
price elasticity of demand
midpoint method
the change in the quantity of that good demanded as the consu…
the change in the quantity of that good demanded that results…
the ratio of the percent changed in the quantity demanded to…
a technique for calculating the percent change
substitution effect
the change in the quantity of that good demanded as the consu…
income effect
the change in the quantity of that good demanded that results…
15 terms
Microeconomics 3
Law of Demand
quantity demanded
Shifts in demand curve
change in demand
states that other things equal the quantity demanded of a goo…
the amount of a good that buyers are willing and able to purc…
-consumer income... -number of buyers... -prices of related goods... -…
caused by any change that alters the quantity demanded at eve…
Law of Demand
states that other things equal the quantity demanded of a goo…
quantity demanded
the amount of a good that buyers are willing and able to purc…
43 terms
Microeconomics 3
adverse selection problem
direct regulation
efficient
effluent fees
a problem that occurs when buyers and sellers have different…
a program in which the amount of a good people are allowed to…
achieving a goal at the lowest cost in total resources withou…
charges imposed by government on the level of pollution created
adverse selection problem
a problem that occurs when buyers and sellers have different…
direct regulation
a program in which the amount of a good people are allowed to…
13 terms
Microeconomics 3
price controls
price ceiling
price floor
wasted resources
legal restrictions on how high or low a market price may go
maximum price sellers are allowed to charge for a good or ser…
minimum price buyers are required to pay for a good or service
people expend money, effort and time to cope with the shortag…
price controls
legal restrictions on how high or low a market price may go
price ceiling
maximum price sellers are allowed to charge for a good or ser…
6 terms
Microeconomics 3
Increasing, decreasing, constant retur…
Price of Labour
Demand determined
Profit Maximizing value of L given a p…
Increase input by 100%. Output should theoretically be more t…
Marginal price of labour * Price of Output
The supply is limited and set. Therefore, the price of the ou…
Derivative of the function results in Marginal price of labou…
Increasing, decreasing, constant retur…
Increase input by 100%. Output should theoretically be more t…
Price of Labour
Marginal price of labour * Price of Output
23 terms
Microeconomics 3
short-run
long-run
economies of scale
diseconomies of scale
at least one thing can't change
all variables can change
when the per unit costs decline as output goes up
when the per unit costs increase as output goes up
short-run
at least one thing can't change
long-run
all variables can change
50 terms
Microeconomics 3
oligopoly
game theory
collusion
if collude...
market structure in which only a few sellers offer identical…
study of how people behave in strategic situations
agreement among firms in a market about quantities and prices
firms would choose to produce a monopoly quantity and split p…
oligopoly
market structure in which only a few sellers offer identical…
game theory
study of how people behave in strategic situations
33 terms
Microeconomics 3
Producers
Opportunity Cost
Explicit Cost
Implicit Goods
Maximize profit
All resources have an opportunity cost
Payment for resources
Opportunity cost of resources owned by the firm and firm owne…
Producers
Maximize profit
Opportunity Cost
All resources have an opportunity cost
88 terms
Microeconomics 3
Market Power
Perfect competition
Monopoly
Oligopoly
extent to which you can charge higher prices without losing t…
many small firms selling identical products (no market power)
when your firm is the only seller (huge MP)
few large sellers that are interdependent (battle for market…
Market Power
extent to which you can charge higher prices without losing t…
Perfect competition
many small firms selling identical products (no market power)
54 terms
Microeconomics 3
Private Goods
Club Goods
Public goods
Common Resources
Rival and Excludable
Nontrivial and excludable
Nontrivial and Nonexcludable
Rival and Nonexcludable
Private Goods
Rival and Excludable
Club Goods
Nontrivial and excludable
27 terms
Microeconomics 3
Oligopoly
Game Theory
Collusion
Cartel
market structure with a few sellers offering similar or ident…
the study of how people behave in strategic situations
agreement among firms in a market about quantities to produce…
multiple firms colluding to act like one firm
Oligopoly
market structure with a few sellers offering similar or ident…
Game Theory
the study of how people behave in strategic situations
20 terms
Microeconomics Chapter 3 Supply
The quantity producers sell depends on
Quantity supplied (Qs):
Supply (S):
Law of supply:
Price (P) of the good;... Other outside things/factors
the amount of a good or service sellers are willing and able…
the relationship between Qs and P
other things equal, the quantity supplied of a good rises whe…
The quantity producers sell depends on
Price (P) of the good;... Other outside things/factors
Quantity supplied (Qs):
the amount of a good or service sellers are willing and able…
43 terms
Microeconomics 3
Monopoly
How monopoly arises
Barrier to entry
Natural monopoly
a market in which one firm sells a good or service that has n…
no close substitute, a barrier to entry
any constraint that protects a firm from competitors
a monopoly that arises because one firm can meet the entire m…
Monopoly
a market in which one firm sells a good or service that has n…
How monopoly arises
no close substitute, a barrier to entry
microeconomics 3
One of the basic principles of economi…
The maximum price that a buyer will pa…
Welfare economics is the study of how
Assume, for Canada, that the domestic…
welfare economics
willingness to pay
the allocation of resources affects economic well-being.
other countries have a comparative advantage over Canada and…
One of the basic principles of economi…
welfare economics
The maximum price that a buyer will pa…
willingness to pay
11 terms
microeconomics 3
Consumer surplus is... a. the amount a bu…
All else equal, what happens to consum…
Suppose the demand for nachos decrease…
Which of the following events would in…
a. the amount a buyer is willing to pay for a good minus the…
a. Consumer surplus increases.
b. It decreases.
a. Sellers' costs stay the same and the price of the good inc…
Consumer surplus is... a. the amount a bu…
a. the amount a buyer is willing to pay for a good minus the…
All else equal, what happens to consum…
a. Consumer surplus increases.
28 terms
microeconomics #3
what kind of services does the U.S. ha…
in terms of capital, how is money goin…
what kind of goods assist people?
what are physical resources?
all financial services, architectural services, software serv…
money is going to be spent on machinery or the start up stuff.
physical, capital and intermediate
land(location), tools, equipment, licenses, insurance that re…
what kind of services does the U.S. ha…
all financial services, architectural services, software serv…
in terms of capital, how is money goin…
money is going to be spent on machinery or the start up stuff.
31 terms
Microeconomics 3
Perfect comp
Monopolistic comp
Oligopoly
Monopoly
Many buyers... Homogeneous product... No barriers to entry/exit... No…
Many buyers/sellers... Differentiated products... No barriers to en…
Few sellers ... May have differentiated goods... Limited barriers
One seller... Single good... No substitutes ... Significant barriers
Perfect comp
Many buyers... Homogeneous product... No barriers to entry/exit... No…
Monopolistic comp
Many buyers/sellers... Differentiated products... No barriers to en…
35 terms
Microeconomics Chapter 3-book notes
In many cases, the price of products w…
Under what circumstances do the forces…
Describe the chart: An Overpriced Prod…
Describe the chart: shows the effect o…
consumers and producers
Strictly speaking, they do so only in what economists term a…
Although an SUV manufacturer can price its SUVs at whatever l…
A simultaneous increase in both the demand for and supply of…
In many cases, the price of products w…
consumers and producers
Under what circumstances do the forces…
Strictly speaking, they do so only in what economists term a…
14 terms
Microeconomics 3
Expensive brand name advertising is a…
Sellers are most likely to offer a dis…
If sales decrease while a products pri…
If sellers tend to follow a price redu…
D. Oligopoly
B. Have high demand elasticity.
C. If demand elasticity is less than one.
C. An oligopoly
Expensive brand name advertising is a…
D. Oligopoly
Sellers are most likely to offer a dis…
B. Have high demand elasticity.
55 terms
Microeconomics Exam #3
Fixed Inputs
Variable Inputs
Short-Run
Long-Run
amount of input necessary does not change with quantity... must…
Amount of input necessary does change with quantity produced
No calendar definition... amount of time in which at least one i…
length of time such that all inputs are variable ... no fixed in…
Fixed Inputs
amount of input necessary does not change with quantity... must…
Variable Inputs
Amount of input necessary does change with quantity produced
52 terms
microeconomics
scarcity
incentive
economics
microeconomics
inability to satisfy all our needs
an additional payment (or other remuneration) to employees as…
the study of how individuals and nations make choices about w…
the study of the economic behavior and decision making of sma…
scarcity
inability to satisfy all our needs
incentive
an additional payment (or other remuneration) to employees as…
89 terms
Microeconomics Chapter 1-3
Choice
Scarcity
Rationing
In a market economy what is used to ra…
The act of selecting among alternatives
The concept that there is less of a good freely available rom…
Allocating scarce goods to those who want them
Price
Choice
The act of selecting among alternatives
Scarcity
The concept that there is less of a good freely available rom…
29 terms
3-MICROECONOMICS
markets
price system
willingness-to-pay
demand
institutions that bring buyers and sellers together so they c…
a name given to the market economy because prices provide con…
an individual's valuation of a good or service, equal to the…
the maximum amount of a product that buyers are willing & abl…
markets
institutions that bring buyers and sellers together so they c…
price system
a name given to the market economy because prices provide con…
113 terms
Microeconomics Exam #3
Consumer Budget Constraint
Total Expenditure
Indifferent Curves
4 Properties of Indifferent Curves
Shows all consumption bundles (all possibilities of 2 goods w…
PxQ of each good, add 2 sums; should = income
Show consumption bundles that give the consumer the same leve…
1. Higher indifferent curves are preferred to lower ones (bec…
Consumer Budget Constraint
Shows all consumption bundles (all possibilities of 2 goods w…
Total Expenditure
PxQ of each good, add 2 sums; should = income
Microeconomics Module #3
What is the PPF?
Efficient
Efficient
Efficient
Production Possibility Frontier
point A
point B
point C
What is the PPF?
Production Possibility Frontier
Efficient
point A
33 terms
Unit 3 Microeconomics
Personal FInance
Budget
Credit
Debt
All of the decisions and activities of an individual or famil…
A plan for future spending and saving, weighing estimated inc…
An agreement in which a buyer is allowed to pay over a period…
Money owed
Personal FInance
All of the decisions and activities of an individual or famil…
Budget
A plan for future spending and saving, weighing estimated inc…
30 terms
3. Economics - Microeconomics
Partial Equilibrium... General Equilibrium
Stable Equilibrium... Unstable Equilibrium
Auctions
Efficient Resource Allocation
hold all other factors constant (Only internal factors)... Ac…
Supply crosses demand from above (S>D -> P goes down)... P move…
Common Value: Value is same to all bidders. Don't know valu…
Where MB=MC and producer and consumer surplus is maximized
Partial Equilibrium... General Equilibrium
hold all other factors constant (Only internal factors)... Ac…
Stable Equilibrium... Unstable Equilibrium
Supply crosses demand from above (S>D -> P goes down)... P move…
20 terms
Microeconomics Ch. 3 Quiz
For a market to be competitive:
According to the law of demand, all ot…
A demand schedule:
According to the figure below, at the…
each buyer and seller is small, relative to the whole market;…
the quantity demanded falls when the price rises, and the qua…
is a table representing the relationship between the price of…
the quantity demanded is 500.
For a market to be competitive:
each buyer and seller is small, relative to the whole market;…
According to the law of demand, all ot…
the quantity demanded falls when the price rises, and the qua…
66 terms
Microeconomics Test #3 Coffman
A perfectly competitive firm will have…
Why is a perfectly competitive firms d…
A monopolistic firm will have what kin…
Why will a monopolistic firm have a re…
perfectly elastic, or flat
Because the price they receive for each additional unit sold…
relatively inelastic, or steep
there are no close substitutes and the marginal revenue will…
A perfectly competitive firm will have…
perfectly elastic, or flat
Why is a perfectly competitive firms d…
Because the price they receive for each additional unit sold…
29 terms
Microeconomics Chapter 3
demand
substitution effect
law of demand
diminishing marginal utility
a schedule showing the amounts of a good or service that *b…
A higher price for a good encourages consumers to *search f…
the principle that, other things equal, an *increase in a pro…
the principle that as a consumer increases the consumption
demand
a schedule showing the amounts of a good or service that *b…
substitution effect
A higher price for a good encourages consumers to *search f…
85 terms
Microeconomics Test 3
partial equilibrium analysis
general equilibrium
efficiency
Pareto efficiency/optimality
the process of examining the equilibrium conditions in indivi…
the condition that exists when all markets in an economy are…
the condition in which the economy is producing what people w…
a condition in which no change is possible that will make som…
partial equilibrium analysis
the process of examining the equilibrium conditions in indivi…
general equilibrium
the condition that exists when all markets in an economy are…
44 terms
AP Microeconomics- Chapters 3 and 4
supply (S) and demand (D) model
market equilibrium (Me)
Engel's Law
law of demand
the model economists use to explain how prices (P) are determ…
when the market price (P) equals the equilibrium price (Pe) a…
the idea that proportional taxes are regressive since the poo…
in the market, the lower the price (P), the higher the quanti…
supply (S) and demand (D) model
the model economists use to explain how prices (P) are determ…
market equilibrium (Me)
when the market price (P) equals the equilibrium price (Pe) a…
28 terms
Microeconomic #3
3 assumption we have to make for M1 to…
Short cut formula for calculating tota…
When the bank make loan, what happens…
What determines a bank's ability to ma…
All bank lend all excess reserve, all loans are spent, all sp…
Level of excess reserve / reserve ratio
M1 increase by the amount of the loan
It's excess reserve
3 assumption we have to make for M1 to…
All bank lend all excess reserve, all loans are spent, all sp…
Short cut formula for calculating tota…
Level of excess reserve / reserve ratio
30 terms
Microeconomics Module 3
constant unitary elasticity
cross-price elasticity of demand
elastic demand
elastic supply
when a given percent price change in price leads to an equal…
the percentage change in the quantity of good A that is deman…
when the elasticity of demand is greater than one, indicating…
when the elasticity of either supply is greater than one, ind…
constant unitary elasticity
when a given percent price change in price leads to an equal…
cross-price elasticity of demand
the percentage change in the quantity of good A that is deman…
52 terms
Microeconomics Exam 3
Explicit Cost
Implicit Cost
Elasticity of Supply
Accounting Costs
Any input (element of cost) for which the firm needs to make…
Any input (element of cost) for which NO payment is necessary…
Measures the degree of responsiveness of the QUANTITY SUPPLIE…
Explicit Costs only
Explicit Cost
Any input (element of cost) for which the firm needs to make…
Implicit Cost
Any input (element of cost) for which NO payment is necessary…
18 terms
Microeconomics- Chapter 3 Labs
What is the value of cost of productio…
Gross National Product
Calculate Gross National Product
Calculate Gross Domestic Product
Cost of production to the firm is the sum of all the factor i…
The total market value of all final goods and services produc…
GDP + Net Foreign Income
To calculate GDP we can use the expenditure approach method,…
What is the value of cost of productio…
Cost of production to the firm is the sum of all the factor i…
Gross National Product
The total market value of all final goods and services produc…
39 terms
Microeconomics -- 3: Elasticity, Microeconomic Policy, and Consumer Theory
Elasticity
Price Elasticity of Demand
Classifications for Price Elasticity o…
Relationship between Elasticity of Dem…
The sensitivity of the consumption to the external changes.
E(d) = (%Change in quantity demanded of good X) / (%Change in…
(1) E(d) > 1, demand is "price elastic" for good X.... (2) E(d)…
The more vertical the curve is, the more inelastic the consum…
Elasticity
The sensitivity of the consumption to the external changes.
Price Elasticity of Demand
E(d) = (%Change in quantity demanded of good X) / (%Change in…
13 terms
Microeconomics chapter 3
Law of Demand
Why does higher price reduce quantity…
Substitution Effect
Income Effect
consumers buy more of a good when its price decreases and les…
-Substitution Effect... -Income Effect
When price of good rises, other things remain the same, its r…
Faced with higher price and unchanged income, people cannot a…
Law of Demand
consumers buy more of a good when its price decreases and les…
Why does higher price reduce quantity…
-Substitution Effect... -Income Effect
41 terms
Microeconomics (Chapter 3)
centralized economy, capitalist economy
centralized economy
capitalist economy
mixed economies
what are the two different approaches that can be taken to an…
this is an economy in which all the decisions that are made a…
this is an economic system in which the production and distri…
this is the economy type of most modern industrial countries.…
centralized economy, capitalist economy
what are the two different approaches that can be taken to an…
centralized economy
this is an economy in which all the decisions that are made a…
69 terms
Microeconomics Test 3
Lecture 8: Elasticity
Elasticity
Price Elasticity of Demand
Elasticity of Demand Formula
Lecture 8: Elasticity
A measure of sensitivity... 4 types: Price Elasticity of Demand,…
A measure of sensitivity of the quantity demanded to a change…
% change quantity demanded / % change price
Lecture 8: Elasticity
Lecture 8: Elasticity
Elasticity
A measure of sensitivity... 4 types: Price Elasticity of Demand,…
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