ECON 201Exam quizzes and answers
well graded 100%
Economics is the study of - ANS✅✅how society manages its scarce resources
Absolute Scarcity - ANS✅✅when supplies of a resource are completely exhausted or extinct
Economic scarcity - ANS✅✅The wants and desires of people outweigh the resources available to
fulfill them
4 categories of resources - ANS✅✅land, labor, capital, entrepreneurship
Normal profits - ANS✅✅Profits made in order to stay in business
Excess profits - ANS✅✅profits earned that are over and above normal profits
3 economic agents - ANS✅✅households, firms, government
Market - ANS✅✅A context in which buyers and sellers voluntarily exchange goods & services
4 main goals of Economics - ANS✅✅1) Efficiency
2) Equity
3) Stability
4) Economic Growth
Macro vs. Micro - ANS✅✅Big picture aggregate concepts vs. study of efficient use of scarce
resources and distribution of income
Opportunity Cost - ANS✅✅the most desirable alternative given up as the result of a decision
Positive Statment - ANS✅✅Just the facts chief
, Normative Statement - ANS✅✅Statement that involves a value judgment
The PPC - ANS✅✅shows the different combinations of two goods that can be produced using full
employment of resources
4 Market price functions - ANS✅✅1) determines resource allocation
2) indication of future relative value
3) give information about the future
4) provides incentives to households and firms
Complete Market Demand Function - ANS✅✅tells us the quantity that consumers are willing and
able to buy at all alternative market prices under all market conditions
Ceteris Paribus - ANS✅✅a Latin phrase that means "all other things held constant"
buyer's reservation price - ANS✅✅the largest dollar amount the buyer would be willing to pay for
a good
Single Market Demand Function - ANS✅✅the quantity that consumers are willing and able to buy
at all alternative market prices, ceteris paribus
Complete market supply function - ANS✅✅tells us the quantity of a good that producers would be
willing and able to supply at all alternative market prices and all alternative market circumstances
Law of Demand - ANS✅✅consumers will buy more of a good when its price is lower and less when
its price is higher
Single Market Supply Function - ANS✅✅tells us the quantity of a good that producers would be
willing and able to supply at all alternative market prices, ceteris paribus
Law of Supply - ANS✅✅Tendency of suppliers to offer more of a good at a higher price
well graded 100%
Economics is the study of - ANS✅✅how society manages its scarce resources
Absolute Scarcity - ANS✅✅when supplies of a resource are completely exhausted or extinct
Economic scarcity - ANS✅✅The wants and desires of people outweigh the resources available to
fulfill them
4 categories of resources - ANS✅✅land, labor, capital, entrepreneurship
Normal profits - ANS✅✅Profits made in order to stay in business
Excess profits - ANS✅✅profits earned that are over and above normal profits
3 economic agents - ANS✅✅households, firms, government
Market - ANS✅✅A context in which buyers and sellers voluntarily exchange goods & services
4 main goals of Economics - ANS✅✅1) Efficiency
2) Equity
3) Stability
4) Economic Growth
Macro vs. Micro - ANS✅✅Big picture aggregate concepts vs. study of efficient use of scarce
resources and distribution of income
Opportunity Cost - ANS✅✅the most desirable alternative given up as the result of a decision
Positive Statment - ANS✅✅Just the facts chief
, Normative Statement - ANS✅✅Statement that involves a value judgment
The PPC - ANS✅✅shows the different combinations of two goods that can be produced using full
employment of resources
4 Market price functions - ANS✅✅1) determines resource allocation
2) indication of future relative value
3) give information about the future
4) provides incentives to households and firms
Complete Market Demand Function - ANS✅✅tells us the quantity that consumers are willing and
able to buy at all alternative market prices under all market conditions
Ceteris Paribus - ANS✅✅a Latin phrase that means "all other things held constant"
buyer's reservation price - ANS✅✅the largest dollar amount the buyer would be willing to pay for
a good
Single Market Demand Function - ANS✅✅the quantity that consumers are willing and able to buy
at all alternative market prices, ceteris paribus
Complete market supply function - ANS✅✅tells us the quantity of a good that producers would be
willing and able to supply at all alternative market prices and all alternative market circumstances
Law of Demand - ANS✅✅consumers will buy more of a good when its price is lower and less when
its price is higher
Single Market Supply Function - ANS✅✅tells us the quantity of a good that producers would be
willing and able to supply at all alternative market prices, ceteris paribus
Law of Supply - ANS✅✅Tendency of suppliers to offer more of a good at a higher price
