Study guides, Class notes & Summaries

If the price of the good increases and the number of unit people want to buy decreases we call this a change in quantity demanded. Answer True The National Weather Service announces in August that they forecast a very good winter. Demand for heavy winter coats increases due to Answer changes in expectations The Law of Demand implies that as price falls demand increases. Answer False If the price of A goes up as a person's income goes down the good is: Inferior Substitute Normal Com...

Willingness to Pay (WTP) Answer the maximum amount that a buyer will pay for a good total willingness to pay (TWTP) Answer the maximum amount of money that buyers in a market are willing and able to give up the index change for Q units of the good Marginal Willingness to Pay (MWTP) Answer the maximum amount of money buyers in the market are willing and able to give up in exchange for a small additional amount of the good Inverse Demand Answer the demand function rearranged such that P i...

consumer surplus Answer the sum (of each unit sold) of the difference between what the buyer is willing to pay (given by the height of the demand curve) and the price the buyer actually pays (market price) how is consumer surplus calculated? Answer area beneath the demand curve and above market price for the number of units sold 1/2 base * height producer surplus Answer the difference between the price received by the seller (market price) and the minimum price the seller is willing to ...

market Answer a group of buyers and sellers of a good or service and the institution or arrangement by which they come together to trade economic assumptions (3 of them) Answer people are rational people respond to economic incentives optimal decisions are made at the margin economics Answer the study of the choices consumers, business managers, and government officials make to attain their goals, given scarce resources economic models Answer simplified versions of reality used to ana...

accounting total cost Answer explicit costs only economic total cost Answer accounting total cost + implicit costs economic total cost is opportunity cost accounting profit = Answer total revenue - accounting total costs economic profit = Answer total revenue - economic total costs when economic profit = 0 Answer normal economic profit; means that the firm is doing as well as it could in it's next best alternative economic profit > 0 Answer firm's owner is doing better tha...

3 1 Quiz GRADED ECO

4 1 Quiz GRADED ECO

ECO 201: Chapter 4 & 6 Questions and Answers (Graded A)ECO 201: Chapter 4 & 6 Questions and Answers (Graded A)ECO 201: Chapter 4 & 6 Questions and Answers (Graded A)ECO 201: Chapter 4 & 6 Questions and Answers (Graded A)If society allows firms to freely pollute the environment, which of the following is true? a) Market equilibrium output will be equivalent to the efficient output level. b) The efficient output level can be achieved by giving firms a subsidy for the pollution they generate. ...

Gross Domestic Product (GDP) is the total market value of all - final goods and services produced annually within a country's borders. Which of the following is counted in GDP? - the services of a real estate broker Macroeconomists define consumption as - purchases by the household sector. To macroeconomists, investment is mainly the purchases of goods and services - by businesses The expenditure approach to measuring GDP sums - consumption, investment, government purchases, and net e...