ECN 211 ASU Final Exam Marburger Questions And Answers

ECN 211 ASU Final Exam Marburger Questions And Answers The Circular Flow Diagram - ANS Green arrows represent the flow of money and red represents to flow of goods/services Production possibilities Frontier/ Curve PPF: PPC - ANS The curve shows what is possible within an economy D- impossible A&B - feasible efficient C - feasible & inefficient PPF shifts out when... - ANS the economy can produce more of everything Opportunity Cost - ANS the cost of what you give up to get something else in terms of time, money, or other goods Absolute Advantage - ANS Who can make most of that good Comparative Advantage - ANS The lowest opportunity cost for that good What would allow Panama and Canada to trade? - ANS They want to trade within their opportunity cost Demand - ANS The amount consumers are willing and able to purchase Supply - ANS The amount that producers are willing and able to produce Law of demand - ANS Demand always slopes down Law of supply - ANS Supply always slopes up Equilibrium - ANS Where the two curves meet Demand shifters - ANS - Price of substitute or complement - Consumer preference - population growth - Income and expectation of future income Supply shifters - ANS - Price of input - Technological advancement - Number of producers - Producer expectation Solve for Equilibrium Price and Quantity - ANS Make both sides equal to each other Ex. Q = 100 - 6P & Q = 28 + 3P