Econ 102 Final Flashcards Inoue Exam Questions With Correct Answers

Econ 102 Final Flashcards Inoue Exam
Questions With Correct Answers

Economics - CORRECT ANSWER✔✔-Is important because we live in a world of
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scarcity with limited resources and limited choices
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Micro vs Macro - CORRECT ANSWER✔✔-micro focuses on individual and types of
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competition will macro focuses on broad lens topics
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Endogenous variables - CORRECT ANSWER✔✔-are what's tested for in the model
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(independent and dependent variables) | | |




Exogenous variables - CORRECT ANSWER✔✔-factors outside of your control
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which may affect the outcome.
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Positive and normative statements - CORRECT ANSWER✔✔-Positive statements
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can be tested and backed up with data, normative statements are opinion
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Scarcity - CORRECT ANSWER✔✔-Economics is important because we live in a
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world with scarcity
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Opportunity cost - CORRECT ANSWER✔✔-amount of good A you could have
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produced instead of producing good B
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(can be constant, increasing, or decreasing)
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,Opportunity cost formula - CORRECT ANSWER✔✔-Y= (# of good X that could have
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been made)/(# of good Y that could have been made)
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PPF - CORRECT ANSWER✔✔-a curve showing the maximum attainable
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combinations of two products that may be produced with available resources and
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current technology
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Comparative Advantage - CORRECT ANSWER✔✔-who has the lower opportunity
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cost for each good
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Absolute Advantage - CORRECT ANSWER✔✔-who produces more of each good
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Law of demand - CORRECT ANSWER✔✔-Inverse relationship between price and
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quantity demanded |




(as price goes up quantity demand goes down and vise versa)
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Determinants of demand - CORRECT ANSWER✔✔-Income
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Preferences
Amount of consumers | |




Future expectations
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Inferior Goods - CORRECT ANSWER✔✔-income goes up / demand decreases
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, Necessity goods - CORRECT ANSWER✔✔-income goes up / demand stays the
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same


Normal goods - CORRECT ANSWER✔✔-income goes up / demand goes up
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Law of supply - CORRECT ANSWER✔✔-positive relationship between price and
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quantity supplied (as price goes up quantity goes up)
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Determinants of supply - CORRECT ANSWER✔✔-Cost of production
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Production technology |




Government policies |




Expectations
Changes in numbers of producers
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Market equilibrium - CORRECT ANSWER✔✔-occurs when supply and demand
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intersect


Shortage - CORRECT ANSWER✔✔-occurs when price is lower the equilibrium
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price and quantity demanded is greater than quantity supplied
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Surplus - CORRECT ANSWER✔✔-occurs when price is higher than equilibrium
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price and quantity demand is less than quantity supplied
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Consumer surplus - CORRECT ANSWER✔✔-when a consumer pays a lower than a
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good is valued at
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