ECON STUDY GUIDE
a right shift in the supply curve will lead to
a decrease in equilibrium price, and an increase in the quantity
which of the following leads to a increase in demand for apples
a fall in the price of apples
A nasty fungus begins to grow on oranges. What will happen to the equilibrium price and quantity of both orange juice and apple juice as a result of this event
a leftward shift due to a decrease in quantity
When the price of wine is $ 15 per, Cam buys 45 bottles per month, the gov. introduces a 50% tax on wine, so he reduces his consumptipn to only 30 bottles. whats his arc elasticity
-1
Four major factors that shift the supply curve
1) the number of sellers in a market, 2) the level of technology used in a good's production, 3) the prices of inputs used to produce a good, 4) the amount of government regulation
If the pre-tax equilibrium price of Good X was $5 and the price that sellers receive after the imposition of a tax of $3 is $4, the incidence of the taxation on sellers is approximately ________.
33% the increase from 3 to 4 is 33% of 3
if the sellers reservation value for a good is 10 and the price at which the gold was sold was 15, the producer surplus is
5
Suppose the market for labor consists of three workers. The wage rate is 50 dollars, Alex supplies 12, Anna 15, and Jim 23, whats the market supply of labor per week
50
The total cost of a firm is 60 dollars, the avc is $6 and the afc is $4, how many units of output does the firm produce?
6 units
What's an example of capital? a. savings and cash b. a television set purchased by a family c. a tractor used by a farmer for plowing his field
A tractor used by a farmer to plow
Suppose the university is trying to determine the most efficient way to allocate the rooms such that those who value the rooms the most get them, which of the following would you suggest as the most efficient?
Auction the rooms off to the highest bidder to get the best possible price
If the demand and supply curve for a commodity shift to the left by the same amount, then iin company to the initial equilibrium, the new equilibrium will be a
a lower quantity and the same price
necessary ingredients to the buyers problem
Consumers tastes and preferences Amount of money the consumer has to spend Prices of goods and services
if the opp cost is $40 per hour, and the individual spends 20 hours in commuting every month, their opportunity cost of time is a. $200 dollars per month b. 80 dollars per month c. 40 dollars per month d. $800 per month
d
The supply curve represents..
THE MINIMUM PRICE SELLERS ARE WILLING TO ACCEPT TO SELL AN EXTRA UNIT OF A GOOD
When one of the four major factors change, causing an increase in supply, the supply curve shifts...
RIGHT
The short run of a supply curve is
The portion of its MC curve that lies below its average cost curve
the social surplus is $60, if another agent enters the market that the MC he incurs is 10 and the marginal benefit is 6 then what is true about this statement
The social surplus will drop by the marginal benefit received
which of these is considered the free rider problem a. a pledge sitting out on lineups but still gets initiated b. a benchwarmer on the hockey team wins a championship
a
The free rider problem is
a burden on a shared resource that is created by its use or overuse of people who dont pay fair share or anything at all
People not listening to the rules expected of them in nature is called
The tradgedy of the commons
what will happen to the apple juice market due to the oranges quantity decrease
Their will be a higher demand for the apple juice, causing the curve to move to the right
Which of the following is a common pool resource a. tuckermans b. a toll road c. a high way
a
Their is a massive increase in August in Maine for Lobster , a right shift in the supply curve would indicate...
an increase in quantity of lobsters
Coffee and Tea are likely substitutes because
an increase in the price of coffee increases the demand for tea
60 bucks to spend. apples are 5 dollars a pound, and berries are 3 dollars a pound for a pie fester. what combos would satisy his needs a. 4 apple 2 berry b. 6 apple, 10 berry c. 7 apple, 5 berry
b
Which statement is a positive economic statement a. gov. should add strict wealth tax laws to decrease the uneven dist. of wealth b. House prices reduce once the interest rates on loans get higher c. Import duties should be increased on goods coming from nations with humble human rights records
b
if a job pays $60 per hour, but has has a non wage cost valued at 43$ per house, the net benefit of taking the job equals... a. $20 per hour b. $17 per hour c. $26 per hour
b
Which of the following is an normative economic stmnt. a. increase in income is accompanied by increase in consumption b. Increase in $ supply leads to increase in the inflation rate c. Increase in government expenditure will lead to an will lead to an increase in well being
c
If a good has a price elasticity of demand equal to 1
elasticity of demand is unitary, quantity changes at the same rate as price
if price is greater than the cost of production than firms will
enter the market
in one hour, sienna can bake 20 cookies or lay drywall in 2 rooms, in one hour ethan can bake 100 cookies or lay the drywall for three rooms
ethan has the absolute and comparative advantage at baking cookies
Demand is perfectly elastic, if the price is changed at all it will...
fall to zero because other competitors will have the price at equilibrium, making nobody buy the original product
competitve market equilibrium
has no unexploited gains from trade
if price is less than the cost of production, firms will
leave the market
Exit of firms causes a
leftward shift in the supply curve
In a regressive tax system
low income households pay a higher percentage of their income as taxes
A price floor is the
lower limit on the price of a good
what is the key two words for normative economic statements?
should, ought to, will
The marginal cost curve intesects...
the average variable cost curve and the average total cost curve at their minimum
if the price of a good increases,
the budget constraint shifts to the left
a tax incidence on buyers is higher if
the elasticity of the market supply curve is higher than the merket demand curve
Suppose the price of apples increases and the demand for plums increases this means...
these two must be substitutes
Average variable cost=
total variable cost/output
A nation should specialize in products that
we have a high comparative advantage for