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55 Cards in this Set

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  • Back

An externality exists when,


A person engages in an activityinfluences the well-being of a bystander and yet neither pays nor receives


On the foreign exchange market, an increase in a country’s exchange ratees

Decrease the quantity demand of its currency

averagefixed cost

increase as output increases

Economists can be college professor as business analysis. If an increasein businesses’ need for econ analysis

less economists will decide to become professors

At a price of $9.50/pound, people buy 45 pounds of lamb. At a price of $10.50/pound, people buy 35pounds of lamb. What is the arcelasticity of demand for lamb in this price range?


2.5

Anexternality exists when


a person engages in an activity that influencesthe well-being of a bystander and yet neither pays nor receives payment forthat effect.

What is true for monopolythat is not true for perfect competition?'>

the firm and the industry are exactly the same entity

Theamount of money that a wheat farmer could have earned if he had planted barleyinstead of wheat is


an implicit cost

The term which means whatever must begiven up to obtain an item is


opportunity cost

1. Scarcity, every economic decisioninvolves

trade off (giving up something)

1. Milk can be used to make yogurt andcheese, other things equal, if consumption starts demanding more yogurt

demand of milk will increase

1. if resources are owned by individualsinstead of government


resources used will be guided by changing related to prices as owners attempt to maximize self interest

demand for cocaine is uni elastic price of cocaine were to rise 10%

dealer income from the sale of cocaine would fall 10%

1. Price for a 27 TV = $450. Consumers buy 1000 of them, prices rises to$550 by 600 of them. What is the priceelasticity of demand in this range?s

2.5

1. In economics “short run” is definedasan

a. As a period of time when at least oneof the four factors of production is fixed in supply

1. The total cost to build 8 tracthouses is $1,000,000. total cost to build 9 tract houses $1,050,000. What is the Margin cost of the 9thtract house.

MC = Change in TC / Change inQuantitytract house.

1. Once it becomes obvious that a commonresource is being overused

as a period of time when at least one of the four factors of production is fixed

if the equilibrium of a dollar in terms of pesos is 20. what is the equilibrium price in terms of dollars

.05

accounting profit is equal to

total revenue minus the explicit cost of producing goods and services

1. Comparative advantage is based on?


opportunity costs

1. Which of the following would nottend to lower the price of VCR?

increasing price of pay per view movies on cable tv

1. Fresh tuna can be canned or used tomake sushi. Other things equals, ifconsumers starts demanding more sushi?


less tuna will be canned and more will be used in tuna sushi

1. At a price of $9.50/pound, people buy45 pounds of lamb. At a price of$10.50/pound, people buy 35 pounds of lamb. What is the arc elasticity of demand for lamb in this price range?

2.5

in economics short run is defined as

a period of time during which at least one production input is fixed

1. Compared to perfect competition,monopoly in the long run?

restricts outputs




changes a higher price




produces at greater than the minimum average total cost




is able to make greater profits

1. A foot-Loofah is worth $15 toEdna. But she buys one on sale at Bathand Body works for just $8 what is the consumer surplus that results fromedna’s purchase?

$7

1. If purchases power parity exists andthe exchange rate is 1.50 u.s. dollars per British pound, then a latte that hasa price of $4.00 in Northridge, California, has a price of _ in London,England?

2.67

because of scarcity every economic decision involves

trade off

1. Anincrease in demand for a product will

draw more resources into the production of the good

in a market economy

resources move to higher valued uses in response to change in price

1. Ineconomics, short run is defined as?


a. Aperiod of time during which at least one production input is fixed.


1. The entryof new firms into a competitive industry will very likely

shift theshort run industry supply curve to the right




cause themarket price to fall




reduce theprofits of firms in the industry




cause themarket quantity sold to rise

1. whichof the following would cause an increase in the demand for us dollars.


an interest rate cut in Europe

Costof $500,000 a year to rent and buy stock. 50,000 a year at working foraccounting and wants to quit what is the opportunity cost?


550000

Whatwill cause outward shift of the Demand curve for electricity?


increase in price of heating oil

a raise in the demand for a resource to produce some product (x) will

raise the cost of using the resource for an alt. product




Reduce the use of that resource in alt lower valued production




Increase the value of the resource


Economistscan be college professor as business analysis. If an increase in businesses’need for econ analysis


less economists willdecide to become professors


Priceelasticity of demand body

percentage change of quality demand divide change in price

Helena does her bathroom Saturday night and she wants to see a movie andsurf the web. If she doesn’t clean her bathroom and surf the web what is thevalue (note she can not see the movie and surf the web).

Value to Helena ofsurfing the web

Nodoubt ticket is $45 and you want to illegally sell it (scalp) for $75 what isthe opportunity cost?


75

Lawof demand states

Price and quantity demand of a good are inverserelated

Morebuyers enter a market Demand increases….


Quantity supply lends to increase




The product are able to use resourcing with higher opportunity cost




Price of good will raise (or increase)

Elasticdemand at any time


cigarettes

GoodA has many substitutes and Good B has none what is true

Demand for Good B is likely to be inelastic andGood A is elastic

Ineconomics the cost of something is?

what you must give to get it

InLA sushi and sashimi are very similar food. What effect will an increase in price of sushi have on the demand curve forsashimi in LA?

the sashimi demand curve will shift to the right

Airlineknow from exp. Vacation travel haveelastic demand for travel whereas business travels have an inelastic demand fortravel in order maximize the airline should?

Try to decrease price for vacationtravelers and increase price for business travelers.

Monopolistsets price a $12 and sells 250 units. The marginal revenue cost corresponding to this level of output are $6and $8 respectively. What recommendation would you give this monopolist.

lower price

Consumersurplus is equal the area below the _________ and above___________

Demand Area; Price

On the foreign exchange market, an increase in a country’s exchange rate

decrease the quantity demand of its currency

Ifyou want to know the long-run equilibrium output of one perfectly competitivefirm, and you are permitted to see only one curve, which one below is mosthelpful?

average total cost

an increase in demand for a product will

draw more resources into the production of the good

The entry of newfirms into a competitive industry will very likely

shift the short run industrysupply curve to the right




cause the market price to fall




reduce theprofits of firms in the industry




cause themarket quantity sold to rise

Apositive consumption externality occurs when

When jack receives abenefit from johns consumption of a certain good

Video store gave an estimate it will cost 500,000 and to quit her jobshe makes 50,000 and the revenue will be 530,000 what is her econ profit?


30k