study for econ Ecn 101 exam 1 (part three)
A change in the expectations of consumers about prices
Shift
A decrease in the price of hazelnut spread (a substitute for peanut butter)
Shift
An increase in the price of peanut butter
Movement Along
If something happens to alter the quantity demanded at any given price, then
the demand curve shifts.
The claim that, other things being equal, the quantity supplied of a good increases when the price of that good rises
Law of Supply
A table showing the relationship between the price of a good and the amount of it that sellers are willing and able to supply at various prices
Supply Schedule
A graphical object showing the relationship between the price of a good and the amount that sellers are willing and able to supply at various prices
Supply Curve
The amount of a good that sellers are willing and able to supply at a given price
Quantity Supplied
Which of the following demonstrates the law of supply?
hen ketchup prices rose, ketchup sellers increased their quantity supplied of ketchup
Which of the following demonstrates the law of supply?
When ketchup prices rose, ketchup sellers increased their quantity supplied of ketchup
Which of the following demonstrates the law of supply?
When ketchup prices rose, ketchup sellers increased their quantity supplied of ketchup
A decrease in the number of producers
Shift
A decrease in the price of peanut butter
Movement Along
A change in expectations about the future price of peanut butter
Shift
Suppose the market for cars is unregulated. That is, car prices are free to adjust based on the forces of supply and demand.
If a shortage exists in the car market, then the current price must be __________ than the equilibrium price. For the market to reach equilibrium, you would expect __________________________ .
Lower; buyers to offer higher prices
When both the demand and supply curves shift, the curve that shifts by the smaller magnitude determines the effect on the undetermined equilibrium object.
False
The following graph shows the market for laptops in 2008. Between 2008 and 2009, the equilibrium price of laptops remained constant, but the equilibrium quantity of laptops increased. From this, you can conclude that between 2008 and 2009, the supply of laptops ________ and the demand for laptops ___________ .
Increase; Increased
the irregular and largely unpredictable fluctuations in economic activity, as measured by the production of goods and services or the number of people employed
Business cycle
the property of society getting the most it can from its scarce resources
Efficiency
the property of distributing economic prosperity uniformly among the members of society
Equality
Cost of the next best alternative use of money, time, or resources when one choice is made rather than another
Opportunity Cost
people who systematically and purposefully do the best they can to achieve their objectives, given the available opportunities
Rational People
a small incremental adjustment to an existing plan of action
Marginal Change
something that induces a person to act, i.e. the prospect of a reward or punishment
Incentive
the decisions of a central planner are replaced by the decisions of millions of firms and households
Market Economy
the ability of an individual to own and exercise control over scarce resources
Property Rights
a situation in which the market on its own fails to produce an efficient allocation of resources
Market Failure
the impact of one person's actions on the well-being of a bystander
Externality
which refers to the ability of a single person or firm (or a small group of them) to unduly influence market prices
Market Power
a visual model of the economy, shows how dollars flow through markets among households and firms
Circular-Flow Diagram
a graph that shows the combinations of output that the economy can possibly produce given the available factors of production and the available production technology
The Production Possibilities Frontier
the study of how households and firms make decisions and how they interact in markets
Microeconomics
the study of economy-wide phenomena, including inflation, unemployment, and economic growth
Macroeconomics
descriptive; make a claim about how the world is; can be confirmed
Positive Statements
prescriptive; claims that attempt to prescribe how the world should be
Normative Statements
the ability to produce a good using fewer inputs than another producer
Absolute Advantage
the ability to produce a good at a lower opportunity cost than another producer
Comparative Advantage
goods and services that are produced abroad and sold domestically
Imports