ECON 1100 – Principles of Microeconomics Exam
1 Study Guide
Description:
Detailed study guide for ECON 1100 Exam 1 (Principles of Microeconomics). Covers all major
introductory topics including scarcity, opportunity cost, supply and demand, market equilibrium,
comparative advantage, and elasticity basics. Notes are well-organized with clear definitions, key
graphs, and example problems to make learning and revision easy. Ideal for quick review or in-depth
preparation before the first exam.
Tags: ECON 1100, Microeconomics, Exam 1, Study Guide, College Notes, UNT, Economics
ECON 1100 Exam 1
positive economics - CORRECT ANSWER ✔✔✔✔✔ deals with
statements that are TRUE
normative economics - CORRECT ANSWER ✔✔✔✔✔ deals with
statements of WHAT SHOULD BE
ceteris paribus assummption - CORRECT ANSWER ✔✔✔✔✔ used to
isolate the relationship between two variables by holding other
influences on the relationship constant
fallacy of false cause - CORRECT ANSWER ✔✔✔✔✔ occurs when it
is assumed that because ONE event follows ANOTHER, the first event
must have CAUSED the SECOND
fallacy of division - CORRECT ANSWER ✔✔✔✔✔ occurs when it is
incorrectly assumed that what is good for or true for the WHOLE is also
good or true for the PARTS
fallacy of composition - CORRECT ANSWER ✔✔✔✔✔ occurs when it
is incorrectly assumed that what is true for the PARTS is also true for
the WHOLE
1
, scarcity - CORRECT ANSWER ✔✔✔✔✔ exists because there are not
enough resources to produce everything people WANT and NEED
resources - CORRECT ANSWER ✔✔✔✔✔ include all the inputs used
to manufacture goods and provide services
factors of production (resources) - CORRECT ANSWER ✔✔✔✔✔ -
land and other natural resources
- labor services
- capital (structures and equipment)
- entrepreneurial ability
opportunity cost - CORRECT ANSWER ✔✔✔✔✔ defines as the value
of the best alternative that must be given up when a choice is made
economic system - CORRECT ANSWER ✔✔✔✔✔ is comprised of the
laws, traditions, institutions, and mechanisms, designed to answer basic
economic questions
economic questions - CORRECT ANSWER ✔✔✔✔✔ of "what outputs
to produce?" or "how to produce the outputs?" or "who gets to
consume the outputs?"
circular flow model - CORRECT ANSWER ✔✔✔✔✔ designed to
explain economic relationships
- consists of two sectors= business and household
- consists of two markets= product and resource
household sectors with markets - CORRECT ANSWER ✔✔✔✔✔ -
consumers (households) DEMAND final goods and services like FOOD,
CLOTHING, HOUSING, MEDICAL CARE, ENTERTAINMENT, which are
exchanged in PRODUCT MARKETS
- resource owners, households SUPPLY labor services and other factors
of production, such as the drilling rights to land they own, to
RESOURCE MARKETS
2
1 Study Guide
Description:
Detailed study guide for ECON 1100 Exam 1 (Principles of Microeconomics). Covers all major
introductory topics including scarcity, opportunity cost, supply and demand, market equilibrium,
comparative advantage, and elasticity basics. Notes are well-organized with clear definitions, key
graphs, and example problems to make learning and revision easy. Ideal for quick review or in-depth
preparation before the first exam.
Tags: ECON 1100, Microeconomics, Exam 1, Study Guide, College Notes, UNT, Economics
ECON 1100 Exam 1
positive economics - CORRECT ANSWER ✔✔✔✔✔ deals with
statements that are TRUE
normative economics - CORRECT ANSWER ✔✔✔✔✔ deals with
statements of WHAT SHOULD BE
ceteris paribus assummption - CORRECT ANSWER ✔✔✔✔✔ used to
isolate the relationship between two variables by holding other
influences on the relationship constant
fallacy of false cause - CORRECT ANSWER ✔✔✔✔✔ occurs when it
is assumed that because ONE event follows ANOTHER, the first event
must have CAUSED the SECOND
fallacy of division - CORRECT ANSWER ✔✔✔✔✔ occurs when it is
incorrectly assumed that what is good for or true for the WHOLE is also
good or true for the PARTS
fallacy of composition - CORRECT ANSWER ✔✔✔✔✔ occurs when it
is incorrectly assumed that what is true for the PARTS is also true for
the WHOLE
1
, scarcity - CORRECT ANSWER ✔✔✔✔✔ exists because there are not
enough resources to produce everything people WANT and NEED
resources - CORRECT ANSWER ✔✔✔✔✔ include all the inputs used
to manufacture goods and provide services
factors of production (resources) - CORRECT ANSWER ✔✔✔✔✔ -
land and other natural resources
- labor services
- capital (structures and equipment)
- entrepreneurial ability
opportunity cost - CORRECT ANSWER ✔✔✔✔✔ defines as the value
of the best alternative that must be given up when a choice is made
economic system - CORRECT ANSWER ✔✔✔✔✔ is comprised of the
laws, traditions, institutions, and mechanisms, designed to answer basic
economic questions
economic questions - CORRECT ANSWER ✔✔✔✔✔ of "what outputs
to produce?" or "how to produce the outputs?" or "who gets to
consume the outputs?"
circular flow model - CORRECT ANSWER ✔✔✔✔✔ designed to
explain economic relationships
- consists of two sectors= business and household
- consists of two markets= product and resource
household sectors with markets - CORRECT ANSWER ✔✔✔✔✔ -
consumers (households) DEMAND final goods and services like FOOD,
CLOTHING, HOUSING, MEDICAL CARE, ENTERTAINMENT, which are
exchanged in PRODUCT MARKETS
- resource owners, households SUPPLY labor services and other factors
of production, such as the drilling rights to land they own, to
RESOURCE MARKETS
2
