Exam (elaborations)
ECO2013 hammock FSU final (1)
- Course
- Institution
ECO2013 hammock FSU final (1)
[Show more]
Seller
Follow
lydiaomutho
Content preview
ECO2013 hammock FSU finalScarcity - ANS-lack of something
choice - ANS-Scarcity implies ________
Opportunity cost - ANS-the value of the best thing we give up to get something
Rational self interest - ANS-assume people are rationally self interested; false but useful
Positive economics - ANS-describes the way the world actually is
Normative economics - ANS-describes the way the world should be
Production possibilities frontier - ANS-graph that shows the combination of output that the
economy can possibly reduce given the available factors of production and the available
production technology; demonstrate that tradeoffs exist and resources can be used efficiently or
wastefully
Simple trade - ANS-voluntary exchange creates value
The law of demand - ANS-- As price increases, the quantity demand decreases
- As price decreases, the quantity demand increases
Marginal value (your willingness to pay for an additional good) - ANS-What does the height of
the demand curve represent?
Diminishing marginal utility - ANS-decreasing satisfaction / usefulness as additional units of a
product are acquired
Consumer surplus - ANS-the difference between the highest price a consumer is willing to pay
for a good/service and the actual price the consumer pays (related to demand curve)
Changes in:
- the time of year
- quality of product
- income
- prices of subsidies
- complements, expectations, or tastes/preferences - ANS-What shifts the demand curve?
to the right - ANS-How does the demand curve shift when theres an increase in demand
, to the left - ANS-How does the demand curve shift when theres a decrease in demand?
Law of supply - ANS-- As price increases, the quantity supplied increases
- As price decreases, the quantity supplied decreases
the marginal cost of producing an additional unit of output - ANS-What does the height of the
supply curve represent
Producer surplus - ANS-difference between how much a producer is paid to produce one unit of
output (the price) and the marginal cost of producing that unit of output
- input costs
- changes in technology
- expectations
- taxes/regulations
- firms enter/exit the market
- natural disasters - ANS-What shifts the supply curve?
Total surplus - ANS-consumer surplus + producer surplus
Equilibrium - ANS-where supply and demand meet
Efficiency - ANS-there is no reallocation of goods/resources that has benefits greater than costs;
theres no way to make total surplus bigger
- total surplus is maximized
- marginal benefits = marginal costs
- every unit produced has a benefit to consumers that is greater than or equal to the cost of
production - ANS-If equilibrium is efficient:
either price OR quantity will be indeterminate (but not both) - ANS-If supply and demand both
shift, then:
supply/demand is inelastic (steep curve) - ANS-If the quantity demanded does not change much
when the price changes, then:
supply/demand is elastic (more flat curve) - ANS-If quantity demanded does not change a lot
when price changes, then:
Price controls - ANS-legal restrictions on what prices can be charged; generally inefficient
Price ceiling - ANS-legal maximum price
Non binding price ceiling - ANS-Price ceiling above equilibrium
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller lydiaomutho. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for $7.99. You're not tied to anything after your purchase.
Can Stuvia be trusted?
4.6 stars on Google & Trustpilot (+1000 reviews)
75860 documents were sold in the last 30 days
Founded in 2010, the go-to place to buy study notes for 14 years now