Economics Test
General Education Ecn 110 with Staff at Manhattan Christian College
About this deck
By: Lindsey Flickinger
Created: 2010-09-17
Size: 23 flashcards
Views: 58
Created: 2010-09-17
Size: 23 flashcards
Views: 58
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Intermediaries
specialize in information either to bring together the parties to a transaction or to buy in order to sell again
Virtual Market
bring buyers and sellers together in cyberspace via personal computers
Speculators
buy now and sell at a higher price
Economics
studies how we use our scarce resources to specialize in production and to exchange and consume goods and services according to the prevailing economic system
Scarce Resources
are land, labor, and capital resources the demands for which exceed the supply if they were given away free
Specialization
is the use of resources to their best advantage
Exchange
is the trading of goods and services produced through specialization
Opportunity Cost
the loss of the next-best alternative
Microeconomics
studies the economic decisions of the individual participants in the economy
Macroeconomics
studies total output and its growth, total employment and unemployment, and the general movement in prices
Economic Agents
engage in production, exchange, specialization, and consumption
Scarcity
exists when the amount of the good or resources offered is less than what users would want if it were given away free
Sole Proprietorship
is owned by one individual who makes all the business decisions, receives all the profits, and bears sole financial responsibility
Partnership
is owned by two or more partners who make all the business decisions, share the profits, and bear financial responsibility jointly
Corporation
is owned by stockholders; it is authorized by law to act as a legal person. The stockholders elect a board of directors, which appoints the management
Principle of Substitution
states that we substitute one good for another as relative prices change
Invisible hand
states that a capitalist economy can function well without government direction by using the signals of the price system
Equilibrium Price
is the price at which the amount of the good people are prepared to buy equals the amount offered for sale
Substitution Effect
when the price of a good falls, people buy more because its relative price has fallen
Income Effect
the resulting increase in purchasing power leads to greater purchases of goods, including the good itself
Shifts in Supply
an increase in supply causes the equilibrium price to fall and the equilibrium quantity to rise. A decrease in supply causes the equilibrium price to rise and the equilibrium quantity to fall
What affects demand?
change in price of substitutes, complements, income, preference, number of buyers, expectations of future prices
What affects supply?
change in the prices of another good, price of resource, technology, number of sellers
About this deck
By: Lindsey Flickinger
Created: 2010-09-17
Size: 23 flashcards
Views: 58
Created: 2010-09-17
Size: 23 flashcards
Views: 58
About StudyBlue
STUDYBLUE makes things that make you better at school.
Things like online flashcards with photos and audio.
Things like personalized quizzes and friendly reminders about when (and what) to study next.
Think of it as a digital backpack™: access to all of your study materials online and on your phone.
STUDYBLUE exists to make studying efficient and effective for every student, for free. Join us.
“I have used this website for three exams, and I see a huge difference in my test results.”
Naj
Naj