Econ 111 Final Exam questions n
answers rated A+ 2025/2026
Public Goods - correct answer ✔✔goods which can e simultaneously consumed by everyone
and no one can be feasibly excluded
Private Goods - correct answer ✔✔goods which cannot be simultaneously consumed by
everyone and it's easy to be excluded
Common Resource - correct answer ✔✔a good that is nonexcludable and rival, ex. fishing in
oceans, driving in traffic
Externalities - correct answer ✔✔a cost or benefit from consumption or production that falls on
someone other than the consumer or producer.
Marginal Cost - correct answer ✔✔The additional cost of producing one additional unit of a
good or service
Long-Run Shifters - correct answer ✔✔Factors of production (Land, Labor, Capital,
Entrepreneurship, Technology)
Short Run AS Shifters - correct answer ✔✔Factors of Production (Land, Labor, Capital,
Entrepreneurship, Technology) and Price Expectations
Aggregate Demand Shifters - correct answer ✔✔GDP Equation (Consumption, Investment,
Government Expenditures, Net Exports)
, Monopoly - correct answer ✔✔a single firm of a product with no close power substitutes and
which is protected from competition by barriers to entry (no supply curve, MC curve instead)
Multiplier Effect - correct answer ✔✔when working inside the PPF and a big expenditure
happens, giving money to the workers, who spend the money paying another worker, and so
on.
Multiplier Effect Equation - correct answer ✔✔1/(1-% of income spent)
Aggregate Demand - correct answer ✔✔The total quantity of goods and services that firms,
households, and government wish to buy at a given price level in the economy
Reasons for downward sloping AD - correct answer ✔✔Wealth Effect(price level of
consumption), Interest rate effect (price level of investment), exchange rate effect (price level of
exports) (not covered in detail)
Aggregate Supply - correct answer ✔✔total amount produced by firms, government, etc in the
country
Reasons for upward sloping AS - correct answer ✔✔Sticky wage theory, sticky price theory
Fiscal Policy - correct answer ✔✔controlling the AD and AS curves using government
expenditures and tax cuts/increases
Monetary Policy - correct answer ✔✔controlling the AD and AS curves by controlling the money
supply (I)
Stagflation - correct answer ✔✔When there is both inflation and the economic growth rate is
low, causing policies to get rid of one to negatively effect the other. and unemployment
answers rated A+ 2025/2026
Public Goods - correct answer ✔✔goods which can e simultaneously consumed by everyone
and no one can be feasibly excluded
Private Goods - correct answer ✔✔goods which cannot be simultaneously consumed by
everyone and it's easy to be excluded
Common Resource - correct answer ✔✔a good that is nonexcludable and rival, ex. fishing in
oceans, driving in traffic
Externalities - correct answer ✔✔a cost or benefit from consumption or production that falls on
someone other than the consumer or producer.
Marginal Cost - correct answer ✔✔The additional cost of producing one additional unit of a
good or service
Long-Run Shifters - correct answer ✔✔Factors of production (Land, Labor, Capital,
Entrepreneurship, Technology)
Short Run AS Shifters - correct answer ✔✔Factors of Production (Land, Labor, Capital,
Entrepreneurship, Technology) and Price Expectations
Aggregate Demand Shifters - correct answer ✔✔GDP Equation (Consumption, Investment,
Government Expenditures, Net Exports)
, Monopoly - correct answer ✔✔a single firm of a product with no close power substitutes and
which is protected from competition by barriers to entry (no supply curve, MC curve instead)
Multiplier Effect - correct answer ✔✔when working inside the PPF and a big expenditure
happens, giving money to the workers, who spend the money paying another worker, and so
on.
Multiplier Effect Equation - correct answer ✔✔1/(1-% of income spent)
Aggregate Demand - correct answer ✔✔The total quantity of goods and services that firms,
households, and government wish to buy at a given price level in the economy
Reasons for downward sloping AD - correct answer ✔✔Wealth Effect(price level of
consumption), Interest rate effect (price level of investment), exchange rate effect (price level of
exports) (not covered in detail)
Aggregate Supply - correct answer ✔✔total amount produced by firms, government, etc in the
country
Reasons for upward sloping AS - correct answer ✔✔Sticky wage theory, sticky price theory
Fiscal Policy - correct answer ✔✔controlling the AD and AS curves using government
expenditures and tax cuts/increases
Monetary Policy - correct answer ✔✔controlling the AD and AS curves by controlling the money
supply (I)
Stagflation - correct answer ✔✔When there is both inflation and the economic growth rate is
low, causing policies to get rid of one to negatively effect the other. and unemployment
