Macro and Microeconomics Ivy Software Quizzes
2025 with 100% Correct Answers
Factors of Production
Land, Labor, Capital, Entrepreneurial Ability
Factors of production encompass
all possible productive resources used to produce goods and services
scarce resources because they are limited in supply
Opportunity Cost
most fundamental principle in economics
whatever must be given up to obtain some item
Comparative advantage
the ability of an individual or group to carry out a particular economic activity (such as making a
specific product) more efficiently than another activity.
Production Possibilities Frontier
The line on a production possibilities graph that shows the maximum possible output
If PPF is linear
then opportunity cost is constant
If PPF is bowed out
then opportunity cost is increasing
,Absolute Advantage
the ability to produce more of a given product using a given amount of resources
Only bundles that are on or below the PPF can be produced
Bundles that lie outside cannot be produced.
Law of Supply
If the price of a good decreases, then ceteris paribus, the quantity supplied of that good will
decrease.
producers offer more of a good as its price increases and less as its price falls
Price Floor
A legal minimum on the price at which a good can be sold
Demand Curve
A graph of the relationship between the price of a good and the quantity demanded
Price Elasticity of Demand
the percentage change in quantity demanded divided by the percentage change in price
Equilibrium Price
the price that balances quantity supplied and quantity demanded
Equilibrium Quantity
The quantity supplied and the quantity demanded at the equilibrium price
Normal Goods
, a good that consumers demand more of when their incomes increase
Inferior Goods
Goods for which demand tends to fall when income rises.
Substitute Good
A good that can be used in place of another good
Complementary Good
A good that is used together with another good
Fixed Cost
a cost that does not change, no matter how much of a good is produced
Marginal Cost
the increase in total cost that arises from an extra unit of production
Economies of Scale
Average Total Cost decreases As type of product increases
Diseconomies of Scale
the property whereby long-run average total cost increases as the quantity of output increases
Constant Economies of Scale
Average Total Cost constant as Output Increases
Economies of Scope
2025 with 100% Correct Answers
Factors of Production
Land, Labor, Capital, Entrepreneurial Ability
Factors of production encompass
all possible productive resources used to produce goods and services
scarce resources because they are limited in supply
Opportunity Cost
most fundamental principle in economics
whatever must be given up to obtain some item
Comparative advantage
the ability of an individual or group to carry out a particular economic activity (such as making a
specific product) more efficiently than another activity.
Production Possibilities Frontier
The line on a production possibilities graph that shows the maximum possible output
If PPF is linear
then opportunity cost is constant
If PPF is bowed out
then opportunity cost is increasing
,Absolute Advantage
the ability to produce more of a given product using a given amount of resources
Only bundles that are on or below the PPF can be produced
Bundles that lie outside cannot be produced.
Law of Supply
If the price of a good decreases, then ceteris paribus, the quantity supplied of that good will
decrease.
producers offer more of a good as its price increases and less as its price falls
Price Floor
A legal minimum on the price at which a good can be sold
Demand Curve
A graph of the relationship between the price of a good and the quantity demanded
Price Elasticity of Demand
the percentage change in quantity demanded divided by the percentage change in price
Equilibrium Price
the price that balances quantity supplied and quantity demanded
Equilibrium Quantity
The quantity supplied and the quantity demanded at the equilibrium price
Normal Goods
, a good that consumers demand more of when their incomes increase
Inferior Goods
Goods for which demand tends to fall when income rises.
Substitute Good
A good that can be used in place of another good
Complementary Good
A good that is used together with another good
Fixed Cost
a cost that does not change, no matter how much of a good is produced
Marginal Cost
the increase in total cost that arises from an extra unit of production
Economies of Scale
Average Total Cost decreases As type of product increases
Diseconomies of Scale
the property whereby long-run average total cost increases as the quantity of output increases
Constant Economies of Scale
Average Total Cost constant as Output Increases
Economies of Scope
