micro

"If I didnt have class tonigh, I would save the $4 Campus parking fee and spend four hours at work where I earn 10 per hour." The opportunity cost of attending class this evening is

44

In a graph when the line of demand is high horizontal

Perfectly elastic demand

In a graph when the line of demand is low horizontal

Perfectly elastic demand

When the line in the graph is vertical

Perfectly inelastic supply

Economists draw a distinction between ___________________, which describe the world as it is, and normative statements, which describe how the world should be.

Positive statements

In a graph when the line has a negative slope

Relatively inelastic demand

The lesson of __________ is to forget about the money that's irretrievably gone and instead to focus on the marginal costs and benefits of future options.

Sunk cost

As depicted in _________________________________, it is necessary to give up some of one good to gain more of the other good.

The production possible frontier

When the line in a graph is like an L

Unitary elasticity

Three economic questions must be determined in all societies

What goods will be produced? How will good be produced? Who will get the goods produced

which of the following is most likely a topic of discussion in macroeconomics

a decrease in the unemployment

A change in price of a good or service typically causes_____ for that specific good or service

a movement along the supply curve

Any given demand or supply curve is based on the ceteris paribus assumption that

all else is held equal

When demand is inelastic

consumers are not very responsive to changes in price.

Demand is said to be_______ when the quantity demanded is very responsive to changes in price

elastic

When economist are sketching example of demand or supply curve that is close to horizontal, they refer to that demand or supply curve as

elastic

If the price is below the equilibrium level, then the quantity demanded will exceed the quantity supplied. This is known as ___________________

excess demand

A supply curve is a graphical illustration of the relationship between price, shown on the vertical axis, and ____________, shown on the horizontal axis.

quantity supplied

Improvements in the productivity of labor will tend to

increase wages

The demand schedule for a good

indicates the quantities that will be purchased at alternative market prices.

An income elasticity of demand equal to -2.0 represents which types of good

inferior

The branch of economics that studies the aggregate decisions of all households and all firms is called

macroeconomics

An income elasticity of demand equal to .4 represents which type of good

necessity

The elasticity of supply is defined as the_____ change in quantity suplied divided by the _____ change in price

percentage: percentage

The "law of supply" functions in labor markets: that is a higher________ for labor leads to a higher quantity of labor supplied

price

In contrast to goods and services markets,_____ are rare in labor markets, because rules that prevent people from earning income are not politically popular

price ceilings

If the demand curve for a life saving medicine is perfectly inelastic, then a reduction in supply will cause the equilibruim price to

rise and the equilibrium quantity to stay the same

A cross price elasticity of demand equal to .5 indicated that two goods are

substitutes

The price elasticity of demand measures the

the responsiveness of the quantity demanded to a change in price

According to the law of supply

there is a direct relationship between price and quantity supplied

When quantity demanded decreased in response to a change in price

there is a movement up along the demand curve

Many state do have ________, which impose an upper limit on the interest rate that lenders can charge

usury laws

The general pattern that consumption of the first few units of any good tends to bring a higher level of________ to a person than consumption of later units is a common pattern

utility

If labor demanded is downward sloping and labor supply is upward sloping, then when labor demand rises more than labor supply, it is expected that real wages

will increase