ECON 110 ZIRLOTT FINAL EXAM
3 sources of barriers to entry - ANSWERS--A single firm owns a key
resource (ex: DeBeers owns most of the worlds diamond mines)
-The gov. gives a single firm the executive right to produce the good
(ex: patents, copyright laws)
-natural monopoly: a single firm can produce the entire market Q at
lower cost than could several firms
Economics - ANSWERS-the study of how society manages its scarce
resources
opportunity costs - ANSWERS-of any item is whatever must be given
up to obtain it
efficiency - ANSWERS-when society gets the most from its scarce
resources
scarcity - ANSWERS-the limited nature of society's resources
Characteristics of a PPF - ANSWERS-a graph that shows the
combinations of 2 goods the economy can possibly produce given the
available resources and technology
,Characteristics of a circular flow diagram - ANSWERS--a visual
model of the economy, shows how dollars flow through markets
among households and firms
-Households (actor): owns the factors of production, sells/rents them
to firms for income. buys and consumes goods and services
-Firms (actor): buy/hire factors of production, uses them to produce
goods and services. sells goods and services
-Market for Goods and Services
-Market for Factors of Production
Microeconomics - ANSWERS-study of how households and firms
make decisions and how they interact in markets
Macroeconomics - ANSWERS-study of economy wide phenomena,
including inflation, unemployment, and economic growth
absolute advantage - ANSWERS-ability to produce a good using
fewer inputs than another producer (make more, using less)
comparative advantage - ANSWERS-ability to produce a good at a
lower opportunity cost than another (if you have a lower oc then you
have the ca)
Equity - ANSWERS-the property of distributing output fairly among
society's members
, externality - ANSWERS-the uncompensated impact of one person's
actions on the well-being of a bystander (fancy term for side effect)
what type of externalities are these?
-being vaccinated against contagious diseases protects not only you,
but people who sit next to you in class
-vaccinating your pets
-R&D creates knowledge others can use
-people going to college raise the population's education level, which
reduces crime and improves government - ANSWERS-Positive
what type of externalities are these?
-air pollution from a factory -> Most Common
-the neighbor's barking dog
-late-night stereo blasting from the dorm room next to yours
-noise pollution from construction projects
-health risk to others from second-hand smoke
-texting on cell phones while driving makes the roads less safe for
others - ANSWERS-Negative
private costs - ANSWERS-supply curve, cost directly incurred by
sellers
3 sources of barriers to entry - ANSWERS--A single firm owns a key
resource (ex: DeBeers owns most of the worlds diamond mines)
-The gov. gives a single firm the executive right to produce the good
(ex: patents, copyright laws)
-natural monopoly: a single firm can produce the entire market Q at
lower cost than could several firms
Economics - ANSWERS-the study of how society manages its scarce
resources
opportunity costs - ANSWERS-of any item is whatever must be given
up to obtain it
efficiency - ANSWERS-when society gets the most from its scarce
resources
scarcity - ANSWERS-the limited nature of society's resources
Characteristics of a PPF - ANSWERS-a graph that shows the
combinations of 2 goods the economy can possibly produce given the
available resources and technology
,Characteristics of a circular flow diagram - ANSWERS--a visual
model of the economy, shows how dollars flow through markets
among households and firms
-Households (actor): owns the factors of production, sells/rents them
to firms for income. buys and consumes goods and services
-Firms (actor): buy/hire factors of production, uses them to produce
goods and services. sells goods and services
-Market for Goods and Services
-Market for Factors of Production
Microeconomics - ANSWERS-study of how households and firms
make decisions and how they interact in markets
Macroeconomics - ANSWERS-study of economy wide phenomena,
including inflation, unemployment, and economic growth
absolute advantage - ANSWERS-ability to produce a good using
fewer inputs than another producer (make more, using less)
comparative advantage - ANSWERS-ability to produce a good at a
lower opportunity cost than another (if you have a lower oc then you
have the ca)
Equity - ANSWERS-the property of distributing output fairly among
society's members
, externality - ANSWERS-the uncompensated impact of one person's
actions on the well-being of a bystander (fancy term for side effect)
what type of externalities are these?
-being vaccinated against contagious diseases protects not only you,
but people who sit next to you in class
-vaccinating your pets
-R&D creates knowledge others can use
-people going to college raise the population's education level, which
reduces crime and improves government - ANSWERS-Positive
what type of externalities are these?
-air pollution from a factory -> Most Common
-the neighbor's barking dog
-late-night stereo blasting from the dorm room next to yours
-noise pollution from construction projects
-health risk to others from second-hand smoke
-texting on cell phones while driving makes the roads less safe for
others - ANSWERS-Negative
private costs - ANSWERS-supply curve, cost directly incurred by
sellers
