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AP Microeconomics Review Flashcards | StudBud
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AP Microeconomics Review
AP Microeconomics Review
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1
What is the Dead Weight Loss in the graph shown?
16
40
80
8
2
Which is a source of monopoly power?
Free markets
Low profits
High elasticity of demand
Barriers to entry
3
What is indicated by the movement from A to B as
curves
reach a new equilibrium?
Change in Quantity Supplied
Change in Quantity Demanded and a Change in Supply
Change in Quantity Demanded
Change in Demand
4
When do consumers pay most of a tax?
When supply curve is elastic
When supply curve is inelastic
When demand curve is inelastic
When demand curve is elastic
5
What is the MRP of the 4th worker if P=$2?
20
15
30
40
6
What does the matrix represent?
Nash equilibrium
Non dominant prisoners dilemma
None of the ablove
Dominant prisoners dilemma
7
Which best defines a capitalistic economy?
Low income taxes
Well functioning capital markets
Property rights and private ownership
Efficient allocation of resources
8
In a side by side graph the supply curve starts where
Marginal Revenue curve is at lowest point
Average Total Cost curve is at lowest point
Average Variable Cost curve is at lowest point
Average fixed cost line is at lowest point
9
What should Italy do to maximize its resources?
Employ fewer workers
Produce wine and trade with Spain
Produce cheese and trade with Spain
No trade because of Absolute Advantage
10
In a perfectly competitive factor market, a firm would follow
Marginal Revenue Product = Demand Curve
MPPL > Rent
Total External Product = Marginal Factor Cost
Total Revenue Product = Supply Curve
11
What does line D show?
Inefficient Production Possibilities
Income equality
Impossible Production Possibilities
Income inequality
12
What does the upper horizontal line represent?
Shortage
Price ceiling
Price floor
Rent control
13
Which will NOT shift a demand curve?
Costs of complementary goods
Costs of substitute goods
Expectations
Costs of inputs
14
If the Long Run Average Total Cost is rising then
The Marginal Cost curve is parallel to it
There is diseconomy of scale
Firms have incentive to get bigger
There is economy of scale
15
What does the graph below illustrate?
Oligopoly Price
Long Run Monopolistic Competition Price
Fair Market Monopoly Price
Price Discrimination
16
Which is NOT a fixed cost?
Manager's salary
Building permit
Computer backup generator
Hourly wages
17
A good that is nonrivalry and nonexcludable in consumption is a(n)
Inferior Good
Pure Public Good
Negative Externality
Giffen Good
18
When is total utility at its maximum?
Marginal Utility is at a maximum
Marginal Utility is equal to zero
Marginal Utility is negative
Marginal Utility is increasing
19
A production possibilities curve is a straight line if
Resources were perfectly substitutable
More immigrants entered the country
More technology was used
Incomes rose uniformly
20
Where would government set a socially optimal price for the monopoly shown?
A
C
F
E
21
Economists refer to short run as
When at least one input is fixed
Less than a month
When curves have elasticities >1
Less than a year
22
Why must individuals make choices about goods and services to produce?
Resources are scarce and human wants are unlimited
Resources have to be allocated so all benefit
Markets do not always allocate resources efficiently
Opportunity costs increase as more of a good is made
23
What type of market structure is shown?
Monopoly
Oligopoly
Monopolistically Competitive
Oligarchy
