ECN 1500 Quiz 1 || 100% Accurate Answers.
Specialization correct answers A focus on a particular activity or area of study
Division of Knowledge correct answers Trade allows people to specialize in certain ideas, which
increases the total knowledge available
Comparative Advantage correct answers The ability to produce a good at a lower opportunity
cost than another producer
Opportunity Cost correct answers The value of possibilities lost when a choice is made
Absolute Advantage correct answers The ability to produce the same good using fewer inputs
than another producer
Shift in Demand correct answers -An increase shifts the demand curve up and to the right
-A decrease shifts the demand curve down and to the left
Shift in Supply correct answers -An increase shifts the supply curve up and to the left
-A decrease shifts the supply curve down and to the right
Price correct answers Monetary value of a product as established by supply and demand
Law of Demand correct answers Consumers buy more of a good when its price decreases and
less when its price increases
Law of Supply correct answers Producers offer more of a good as its price increases and less as
its price falls
Producer Surplus correct answers The producer's gain from exchange, or the difference between
the market price and the minimum price at which a producer would be willing to sell a particular
quantity
Consumer Surplus correct answers The consumer's gain from exchange, or the difference
between the maximum price a consumer is willing to pay for a certain quantity and the market
price
Equilibrium correct answers The quantity demanded equals the quantity supplied
Surplus correct answers A situation in which quantity supplied is greater than quantity demanded
Shortage correct answers A situation in which quantity demanded is greater than quantity
supplied
Price Ceiling correct answers A maximum price allowed by law
Specialization correct answers A focus on a particular activity or area of study
Division of Knowledge correct answers Trade allows people to specialize in certain ideas, which
increases the total knowledge available
Comparative Advantage correct answers The ability to produce a good at a lower opportunity
cost than another producer
Opportunity Cost correct answers The value of possibilities lost when a choice is made
Absolute Advantage correct answers The ability to produce the same good using fewer inputs
than another producer
Shift in Demand correct answers -An increase shifts the demand curve up and to the right
-A decrease shifts the demand curve down and to the left
Shift in Supply correct answers -An increase shifts the supply curve up and to the left
-A decrease shifts the supply curve down and to the right
Price correct answers Monetary value of a product as established by supply and demand
Law of Demand correct answers Consumers buy more of a good when its price decreases and
less when its price increases
Law of Supply correct answers Producers offer more of a good as its price increases and less as
its price falls
Producer Surplus correct answers The producer's gain from exchange, or the difference between
the market price and the minimum price at which a producer would be willing to sell a particular
quantity
Consumer Surplus correct answers The consumer's gain from exchange, or the difference
between the maximum price a consumer is willing to pay for a certain quantity and the market
price
Equilibrium correct answers The quantity demanded equals the quantity supplied
Surplus correct answers A situation in which quantity supplied is greater than quantity demanded
Shortage correct answers A situation in which quantity demanded is greater than quantity
supplied
Price Ceiling correct answers A maximum price allowed by law
