ECON 300 Exam 1
Study online at https://quizlet.com/_fl3ffp
1. How to find the market equilibri- Set the Demand and Supply curves EQUAL to one another,
um: and solve for P. Once you find P, plug it back in and solve for
Q.
2. Price Elasticity of Demand = (Change in Q/Change in P) x (P/Q)
3. Price Elasticity of Demand can (Change in Q/Q) / (Change in P/P)
also equal ...
4. Price Elasticity of Supply = (Change in Quantity Supplied / Change in Price) x (P/Quan-
tity Supplied)
5. Price Elasticity of Supply can also (Change in Quantity Supplied / Quantity Supplied) /
equal ... (Change in Price / Price)
6. Cross Price Elasticity of Demand (Change in QD of Good 1 / QD of Good 1) / (Change in P of
= Good 2 / P of Good 2)
7. Basic format of Quantity De- Qd = a - bP
manded =
8. Basic format of Quantity Sup- Qs = c + dP
plied =
9. Equilibrium = a - bP = c + dP
10. Income Elasticity of Demand = (Change in Quantity Demanded / Quantity Demanded) /
(Change in Income / Income)
11. Supply Curve goes ... Sky High
12. Demand curve goes .. Down
13. Elasticity
1/5
, ECON 300 Exam 1
Study online at https://quizlet.com/_fl3ffp
a measure of the responsiveness of quantity demanded or
quantity supplied to a change in one of its determinants
(usually price)
14. Inelastic Describes demand that is not very sensitive to a change in
price (Elasticity measure < -1 or 1)
15. Elastic describes demand that is very sensitive to a change in price
(Elasticity measure > -1 or 1)
16. Demand > Supply Shortage
17. Demand < Supply Surplus
18. Average Product of Labor = output / labor input = q / L
19. Marginal Product of Labor = Change in Output / Change in Labor
20. Production Function F(K, L) >> K = Capital, L = Labor
21. Theory of the Firm Organizational Economics >> How a firm makes cost-mini-
mizing production decisions and how its cost vary with out-
put.
22. Theory of the Firm can be under- 1. Production Technology
stood in three steps: 2. Cost Constraints
3. Input Choices
23. Marginal Rate of Technical Sub- = - change in capital input / change in labor input
stitution (MRTS)
24. Point Elasticity and Arc Elasticity False
give the same outcome. T/F?
25. Normal Good
2/5
Study online at https://quizlet.com/_fl3ffp
1. How to find the market equilibri- Set the Demand and Supply curves EQUAL to one another,
um: and solve for P. Once you find P, plug it back in and solve for
Q.
2. Price Elasticity of Demand = (Change in Q/Change in P) x (P/Q)
3. Price Elasticity of Demand can (Change in Q/Q) / (Change in P/P)
also equal ...
4. Price Elasticity of Supply = (Change in Quantity Supplied / Change in Price) x (P/Quan-
tity Supplied)
5. Price Elasticity of Supply can also (Change in Quantity Supplied / Quantity Supplied) /
equal ... (Change in Price / Price)
6. Cross Price Elasticity of Demand (Change in QD of Good 1 / QD of Good 1) / (Change in P of
= Good 2 / P of Good 2)
7. Basic format of Quantity De- Qd = a - bP
manded =
8. Basic format of Quantity Sup- Qs = c + dP
plied =
9. Equilibrium = a - bP = c + dP
10. Income Elasticity of Demand = (Change in Quantity Demanded / Quantity Demanded) /
(Change in Income / Income)
11. Supply Curve goes ... Sky High
12. Demand curve goes .. Down
13. Elasticity
1/5
, ECON 300 Exam 1
Study online at https://quizlet.com/_fl3ffp
a measure of the responsiveness of quantity demanded or
quantity supplied to a change in one of its determinants
(usually price)
14. Inelastic Describes demand that is not very sensitive to a change in
price (Elasticity measure < -1 or 1)
15. Elastic describes demand that is very sensitive to a change in price
(Elasticity measure > -1 or 1)
16. Demand > Supply Shortage
17. Demand < Supply Surplus
18. Average Product of Labor = output / labor input = q / L
19. Marginal Product of Labor = Change in Output / Change in Labor
20. Production Function F(K, L) >> K = Capital, L = Labor
21. Theory of the Firm Organizational Economics >> How a firm makes cost-mini-
mizing production decisions and how its cost vary with out-
put.
22. Theory of the Firm can be under- 1. Production Technology
stood in three steps: 2. Cost Constraints
3. Input Choices
23. Marginal Rate of Technical Sub- = - change in capital input / change in labor input
stitution (MRTS)
24. Point Elasticity and Arc Elasticity False
give the same outcome. T/F?
25. Normal Good
2/5
