ECO2023 MIDTERM
The accumulation of experience, education, knowledge, and skills possessed by the labor force in an economy is defined as ________
Human Capital
MC (Marginal Costs)
MC= ^TC/^Q
The economic term used to define the amount of satisfaction obtained from the consumption of an additional unit of a good or service is
Marginal Utility
According to the invisible hand concept, resources are allocated by _________
Market Forces
When a business firm pollutes the air the market fails. This market failure is known as
Negative Externality; External Costs
If the demand for good A increases and the demand for good B decreases as a result of an increase in income, good A is_____ and good B is _______
Normal good; inferior good
Marginal Product is the additional ____ obtained from an addition unit of _____ and is also a measure of ______
Output;input; productivity
If the same price of a good is charged at any level of quantity demand the demand for the at is ______
Perfectly Elastic. _____ Horizontal.
If the same quantity of good is demanded at any level of price, the demand for that good is _______ and the curve derived from that demand is ______
Perfectly Inelasticity. Vertical I
The relationship between factors of production and output is the _____
Production Function
demand falls from 3.0 to 2.25 mil because of an average price increase from 3k to 5k per unit. The coefficient of price elasticity of demand is approximately:
Q1-Q2 -------- Q1+Q2 x P1+P2 -------- P1-P2 .57
According to the law of supply, ceteris paribus, if prices go up
Quantitive supply goes up
Ceteris Paribus means
other things remain equal
By definition, the price elasticity of demand is equal to the ________ divided by the _______
percent change in quantity demand; percent change in price %^Qd -------- %^P
According to the law of demand, ceteris paribus, if prices go up
quantity demand goes down.
The expression marginal product decreases as more input is used is consistent with the law of _____
return
AVC (Average Variable Costs)
AVC= TVC/Q [TVC= TC-TFC]
A change in Quantity supplied is a ______ the supply curve due to a change in ________
movement; price
Supply Curve Demand curve Price axis Quantity Axis
/ \ I __
AFC (Average Fixed Costs)
AFC= TFC/Q
ATC (Average Total Costs)
ATC= TC/Q
A factor helping an economy achieve high levels of productivity is the abundance of
Capital
if the price of good A increases and as a result the demand for good B decreases the A and B are _________
Complementary goods
If goods A & B are substitutes and the price of A increases, the _____ for B will ____
Demand; Increase
If goods A & B are used together and the price of B decreases, the ______ for A will ____
Demand; Increase
The economizing problem is created by the fact that society's wants are ________ and the resources to satisfy them are _________
Unlimited; limited
The economy is concerned with the
best use of scarce resources
the introduction of a new cell phone model in the market will shift the ______ curve to old models to the ______
demand curve; left (decrease in demand)
if consumers believe that the economy is improving the ______ curve of consumable goods will shift to the _____
demand, right
If consumers are affected first the curve is ________, if business firms are affected the curve is ______
demand; supply
Opportunity Cost is anything
given up to obtain something else.
A public good is characterized by _______ consumption.
joint
The fact that a greater production of one good requires increasingly larger amounts of other goods sacrificed is consistent with the law of
law of increasing opportunity costs
A change in quantity demand is a _____ the demand curve due to a change in ______
movement; price
A change in the supply is a _______ the supply curve due to a change in ________
shift; not due to change in price but change in determinant of demand or external variable.
A change in demand is a ______ in the demand curve due to a change in ______
shift; not due to price but a change in determinant of Demand or External variable.
If the demand for good A increases and as a result the demand for good B increases then A and B are _____
substituting
A new technology in the car production will shift the _______ curve of the cars to the _______
supply curve; right (means positive)
A costly environmental restriction introduced by the government in the chemical industry will shift the ____ curve of the chemicals to the _____
supply; left
An increase in the cost of coffee beans, which is used to make coffee, will cause the _________ for coffee to shift __________.
supply; left
The basic questions faced by any economy are _______ to produce ________, to produce it, and __________ to produce it to.
what; how; who