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31 Cards in this Set

  • Front
  • Back
Who are the players in economics?
Producers, consumers, distributors/retailers, government, stock market
What is the definition of Economics?
The study of the production, distribution, consumption, of scarce goods and services
What are examples of a non-durable good?
What are examples of a durable good?
What is Microeconomics?
-Things on a smaller scale
-Looks at the players (consumers & firms)
What is Macroeconomics?
-Things on a larger scale
-U.S. economy
-Asks "who are the drivers in our economy?"
(Consumers, government, export and import and investors)
On a consumer vs. income graph the linear functions have…?
A direct relationship
On a consumer vs. income the equation of the line is…?
Y=mx+b (where m is the slope and b is the y intercept)
On a consumption function graph what is on the y –axis and what is located on the x-axis?
On the y-axis is concumption and on the x-axis is Income
What is the definition of Demand?
At every price how much will be bought
What is Income Effect?
You feel poor so you buy less
What is the Substitution Effect?
Relative to the price of something else price is higher so it makes alternative product look better
What will cause a change in demand/make the entire curve to change?
– Population change → the curve would shift right if population increases
– Change in taste and preferences
– Change in income → as income goes up, curve moves to the right, as income goes down curve moves to the left
– Change in price of related goods → substitution, complement
– Special events
What is equal at every point along the 45º line?
Income & Consumption
A line drawn from where to where equals income?
From the x-axis (income) to the 45º line
What is the Law of Downward Sloping Demand?
When the price of a good rises, the demand for the good falls (all other things being equal)
On a demand curve what is located on the y-axis?
on a demand curve what is located on the x-axis?
What is the deffintion of Supply curve?
As the price goes (up & down) amount supplied goes (up & down) up with up, and down with down
What causes shifts in the supply curve?
-change in price of inputs
-technological changes
-demand for relative goods
-government policy * tax breaks & subsides (for exports)*
-special influences (weather, major world events, company culture)
If price of inputs goes up and the supply curve goes left, what happens to the equalibrium point & quantity?
the equalibrum point goes up and quantity goes down
You are a steal importer and the goverment puts a tax on imported steal what happens to your supply and demand curves?
the price would go up to p2 and if the price goes up all you know is demand quantity goes down
If population goes up the demand goes______, so the demand curve shifts to the _______.
The demand curve is ___________ sloping.
On a demand curve Price and Quantity are _________ related.
Describe income effect.
as price moves up money doesn't go as far
Describe substitution effect.
if price goes up you choose a different product, a change in price or quantity does not shift the demand curve
The Supply curve is _________ sloping.
On a supply curve Price and Quantity are ___________ related.
What does GDP stand for?
Gross domestic product
What is GDP?
the total amount of goods and services produced