Econ 102 Exam 1 Inoue Penn State |
Actual study set | Questions and verified
Answers
Economics - ANSW-the study of choices made in a constrained environment because we live in a world
with scarcity
normative - ANSW-opinion based
positive - ANSW-fact, has been tested
endogenous - ANSW-controlled or tested for in an experiment
exogenous - ANSW-things outside your control that will affect the results
opportunity cost - ANSW-the amount of good B you give up to make good A, the cost of sacrificing the
next best thing
opportunity cost formula - ANSW-# of a good that could've been made (y)/ # of good that was made
instead (x) -> opc you are looking for goes on the bottom
PPC - ANSW-shows max. amount of 2 products that can be produced by a society from the currently
available factors of production
points on the PPC - ANSW-efficient, everything that is being used to produce goods is being used
points inside the PPC - ANSW-inefficient, not all our resources are being used
points outside the PPC - ANSW-unattainable, we would love to make them, but we don't have the
resources
formula of finding the OpC from the PPC (non-linear) - ANSW-slope formula-> y2-y1/x2-x1
ways to increase maximum production - ANSW-invest in more capital, technology growth
who has the comparative advantage? - ANSW-who has the lower OpC of producing each good, they
produce the good and trade with the other firm
who has the absolute advantage? - ANSW-whoever produces more of each good
law of demand - ANSW-the inverse relationship between price and quantity demanded
demand curve slope - ANSW-negative
shifts ON the demand curve - ANSW-whenever price of quantity demanded changes, endogenous factors
shifts OF the curve - ANSW-change in anything else except price, our model does not control for these
factors, so we have to shift our model to account for these
increase in demand - ANSW-shift demand curve to the right
decrease in demand - ANSW-shift demand curve to the left
determinants of demand - ANSW-# of consumers, price of complements and substitutes, consumer
preferences, future expectations, income of buyers
law of supply - ANSW-positive relationship between price and quantity supplied
shifts ON the supply curve - ANSW-whenever the price or quantity supplied changes
shifts OF the supply curve- determinants - ANSW-# of suppliers, future expectations, taxes and subsidies,
technology
Actual study set | Questions and verified
Answers
Economics - ANSW-the study of choices made in a constrained environment because we live in a world
with scarcity
normative - ANSW-opinion based
positive - ANSW-fact, has been tested
endogenous - ANSW-controlled or tested for in an experiment
exogenous - ANSW-things outside your control that will affect the results
opportunity cost - ANSW-the amount of good B you give up to make good A, the cost of sacrificing the
next best thing
opportunity cost formula - ANSW-# of a good that could've been made (y)/ # of good that was made
instead (x) -> opc you are looking for goes on the bottom
PPC - ANSW-shows max. amount of 2 products that can be produced by a society from the currently
available factors of production
points on the PPC - ANSW-efficient, everything that is being used to produce goods is being used
points inside the PPC - ANSW-inefficient, not all our resources are being used
points outside the PPC - ANSW-unattainable, we would love to make them, but we don't have the
resources
formula of finding the OpC from the PPC (non-linear) - ANSW-slope formula-> y2-y1/x2-x1
ways to increase maximum production - ANSW-invest in more capital, technology growth
who has the comparative advantage? - ANSW-who has the lower OpC of producing each good, they
produce the good and trade with the other firm
who has the absolute advantage? - ANSW-whoever produces more of each good
law of demand - ANSW-the inverse relationship between price and quantity demanded
demand curve slope - ANSW-negative
shifts ON the demand curve - ANSW-whenever price of quantity demanded changes, endogenous factors
shifts OF the curve - ANSW-change in anything else except price, our model does not control for these
factors, so we have to shift our model to account for these
increase in demand - ANSW-shift demand curve to the right
decrease in demand - ANSW-shift demand curve to the left
determinants of demand - ANSW-# of consumers, price of complements and substitutes, consumer
preferences, future expectations, income of buyers
law of supply - ANSW-positive relationship between price and quantity supplied
shifts ON the supply curve - ANSW-whenever the price or quantity supplied changes
shifts OF the supply curve- determinants - ANSW-# of suppliers, future expectations, taxes and subsidies,
technology
