ECON 1123 - Exam 1
1.25
a fall in the price of lemons from $11 to $9 per bushel increases the quantity demanded from 35 to 45 bushels. the price elasticity of demand is
zero elasticity
a good with a vertical demand curve has a demand with
1.6
a rise in the price of cabbage from $14 to $18 per bushel increases the quantity supplied from 8,000 to 12,000 bushels. the elasticity of supply is
fully utilizing all of its productive resources
a society that is producing on its production possibility fronteir is
20 units
according to the diagram of the figure above, an allocatively efficient use of resources requires that production and consumption be
command
allocating resources by the order of someone in authority is a _______ allocation method
an opportunity cost
because we face scarcity, every choice involves
the ability to perform an activity at a lower opportunity cost than anyone else
comparative advantage is
cross elasticities are negative
if goods are complements, then their
the demand curve for a normal good shifts leftward
if income decreases or the price of a complement rises
A and B are substitutes
if the cross elasticity of demand between goods A and B is positive
is an inferior good
if the income elasticity of demand for spaghetti is -1.3, then spaghetti
the way things ought to be
in economics, normative statements are about
$45,000
in the above figure, when the efficient quantity of gloves is produced, the total surplus is
1 video tape
in the figure above, at point A what is the opportunity cost of producing one more audio tape
marginal benefit of a computer exceeds the marginal cost of a computer, so more computers
in the figure above, if 1 million computers are produced per year, then the ________ should be produced to achieve efficient resource use
10 ties and 12 shirts
in the figure above, if Maria and Ana both completely specialized and traded with one another, their joint output would be
less production efficient than point C not production efficient and point B is production efficient
in the figure above, point A is
3 audio tapes
in the figure above, the marginal cost of the third computer is
$4 million
in the figure above, what is the total consumer surplus from all the milk bought if the price of milk is $3 per gallon
from point A to point D
in the figure above, which movement reflects an increase in demand
highest-valued alternative forgone
opportunity cost means the
price received for a good minus its marginal cost
producer surplus is the _____ summoned over the quantity sold
people cannot satisfy all their wants
scarcity is a situation in which
make choices
scarcity requires that people must
figure A
the above figure shows the market for oranges. which figure shows the effect of a new government program that provides each public school child with an orange to start the day
figure A
the above figures show the market for oranges. which figure shows the effect of changing consumer preferences for more orange juice and less coffee in the morning
40,000 and 500
the demand and supply curves for green tea are given by the following equations Q = 50,000 - 20P Q = 25,000 + 30P where P is measured in dollars and Q is the number of t-shirts sold per year the equlibrium quantity is _____ and the equilibrium price is _____
48, 4
the demand and supply curves for t-shirts in touristtown, USA, are given by the following equations Q = 60 - 3P and Q = 40 + 2P where P is measured in dollars and Q is the number of t-shirts sold per year the equilibrium quantity is _____ and the equilibrium price is ____
give up some of good X in order to obtain more of good Y
the figure above illustrates Mary's production possibilities frontier. if Mary wants to move from point C to point B, she must
receives consumer surplus of 20
the figure above shows Clara's demand for CDs. if the market price for a CD is $20, then Clara
smaller the quantity of the good demanded
the law of demand states that, other things remaining the same, the higher the price of a good, the
opportunity cost
the loss of the highest-valued alternative defines the concept of
sum
the market demand curve for jeans is the ______ of all individual demand curves for jeans
marginal benefit
the maximum amount a person is willing to pay for one more unit of a good
substitutes
the price of a pencil increases and people buy more pens. you infer that pens and pencils are
unitarianism
the principle that states we should strive to achieve the greatest happiness for the greatest number is called
depicts the boundary between those combinations of goods and services that can be produced and those that cannot given resources and the current state of technology
the production possibilities frontier
the amount that producers are planning to sell at a particular price during a given time period
the quantity supplied of a good is
the symmetry principle
the requirement that people in similar situations be treated similarly is
property rights
the rights of an owner to use and exchange property are
microeconomics
the study of the decision of individual units in the economy is known as
5.0
the table above gives the demand schedule for snow peas. the price elasticity of demand between $7 and $8 per bushel is
leftward shift in the supply curve
to say that "supply decreases" for any reason, means there is a
the nation can gain from trade
when a nation has comparative advantage in the production of a particular good
inability of society to satisfy all human wants because of limited resources
when an economist talk of scarcity, the economist is referring to the
an inferior good
when people's income increase, the demand for a good decreases. the good is called
increasing
when the opportunity cost of producing more of a good is increasing, the marginal cost of producing more of the good is
