Econ 212 Exam 1 || A+ GRADED
What are the scarce resources used to produce goods and services? correct answers Land,
Labor, Capital, Entrepreneurial Ability, Production and Efficiency
Economic growth determinants: correct answers Expanding resources, and improving
technology
Determinants of Demand: correct answers Tast and preferences, Income, Prices of related
goods, the number of buyers, and expectations regarding future prices income and product
availability.
Determinants of supply: correct answers Production technology, costs of resources, price of
other commodities, expectations, number of sellers, and taxes and subsidies
Determinants of Elasticity: correct answers more substitutes available.
The good represents a larger portion of the household budget.
Longer time period is being reconsidered.
Good is more of a luxury rather than a necessity.
Define: ceteris paribus correct answers Assumption used in economics ( and other disciplines
as well), where other relevant factors or variables are held constant.
Define: Opportunity Cost correct answers The next best alternative what you give up to do
something or purchase something.
Define: Production efficiency correct answers Goods and services are produced at their
lowest resource (opportunity cost)
Define: Allocative efficiency: correct answers The mix of goods and services produced is just
what the society desires.
Define: Comparative advantage correct answers One country has a lower opportunity cost of
producing a good than another country.
Define: Horizontal summation correct answers Market demand and supply curves are found
by adding together how many units of the product will be purchased or supplied at each price.
Define: Normal good correct answers A good for which an increase in income results in
rising demand
Define: Inferior good correct answers A good for which an increase in income results in
declining demand
Define: supply curve correct answers supply schedule information translated to a graph
Define & consequences: surplus: correct answers Occurs when the price is above market
equilibrium, and quantity supplied exceeds quantity demanded. Buyers get items for
attractive price
What are the scarce resources used to produce goods and services? correct answers Land,
Labor, Capital, Entrepreneurial Ability, Production and Efficiency
Economic growth determinants: correct answers Expanding resources, and improving
technology
Determinants of Demand: correct answers Tast and preferences, Income, Prices of related
goods, the number of buyers, and expectations regarding future prices income and product
availability.
Determinants of supply: correct answers Production technology, costs of resources, price of
other commodities, expectations, number of sellers, and taxes and subsidies
Determinants of Elasticity: correct answers more substitutes available.
The good represents a larger portion of the household budget.
Longer time period is being reconsidered.
Good is more of a luxury rather than a necessity.
Define: ceteris paribus correct answers Assumption used in economics ( and other disciplines
as well), where other relevant factors or variables are held constant.
Define: Opportunity Cost correct answers The next best alternative what you give up to do
something or purchase something.
Define: Production efficiency correct answers Goods and services are produced at their
lowest resource (opportunity cost)
Define: Allocative efficiency: correct answers The mix of goods and services produced is just
what the society desires.
Define: Comparative advantage correct answers One country has a lower opportunity cost of
producing a good than another country.
Define: Horizontal summation correct answers Market demand and supply curves are found
by adding together how many units of the product will be purchased or supplied at each price.
Define: Normal good correct answers A good for which an increase in income results in
rising demand
Define: Inferior good correct answers A good for which an increase in income results in
declining demand
Define: supply curve correct answers supply schedule information translated to a graph
Define & consequences: surplus: correct answers Occurs when the price is above market
equilibrium, and quantity supplied exceeds quantity demanded. Buyers get items for
attractive price
