ECON exam 1
Which of the following transactions does not take place in the markets for factors of production in the circular-flow diagram?
Nia buys two business suits to wear to her job as a Chief Information Officer.
Which of the following events would cause a movement downward and to the left along the supply curve for mangos?
The price of mangos falls.
Trade between countries
allows each country to consume at a point outside its production possibilities frontier.
The price elasticity of demand (own price elasticity) measures
buyers' responsiveness to a change in the price of a good.
Positive statements are
claims about how the world is.
The law of demand states that, other things equal, when the price of a good
falls, the quantity demanded of the good rises.
By definition, exports are
goods produced domestically and sold abroad.
If the price elasticity of supply is 1.5, and price increased by 7 percent, quantity supplied would
increase by 10.50 percent.
When the price of candy bars is $1.10, the quantity demanded is 480 per day. When the price falls to $0.90, the quantity demanded increases to 530. Given this information and using the midpoint method, we know that the demand for candy bars is
inelastic
The supply of a good will be more elastic, the
longer the time period being considered.
The production possibilities frontier provides an illustration of the principle that
people face trade-offs.
A supply schedule is a table that shows the relationship between
price and quantity supplied.
When the quantity demanded has increased at every price, it might be because
the price of a complementary good has decreased.
Income elasticity of demand measures how
the quantity demanded changes as consumer income changes.
Suppose there are only two people in the world. Each person's production possibilities frontier also represents their consumption possibilities when
they choose not to trade with one another.
The opportunity cost of an item is
what you give up to get that item.
