cost or benefit that falls on the third party

What are the determinants of Demand

price, income, taste&preferences, population, expectations

situation where demand is greater than the supply

unlimited wants, but limited resources

What is the law of demand

As price increases the quantity demanded decreases (inverse)

situation where demand is less than supply

amount supplied to a market at a particular price and time

What is the definition of elasticity?

measure of responsivenes in one variable when another change

What is substitution effect?

price change that motivates consumers to by cheaper products

what is not the correct characteristic of indirect tax?

Government does not have the right to use indirect tax

amount of goods consumers are willing and able to purchase

define a market failure

situation where the allocation of resources is not efficient

when externalities exist

social benefit does not equal private benefit

4 categories of resources

land, labour, capital, entrepreneurship

What is the law of supply

increase in price will lead to increase in quantity supplied

where buyers and sellers come together for exchange

What is the income effect?

Income limits your choice of purchases

The law of diminishing marginal utility

consuming more product eventually gets less satisfaction

when demand of consumer = supply of producers

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Micro Review

45 termsStudBud Administration8 plays

#Economics #Micro #Basics #IB #7

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Questions 45

Answers

1
what is this showing?
Tax burden for sellers
Tax burden for producers
Government revenue
Tax burden for consumers
2
what is the value of PED that shows inelasticity
PED is >0
PED is >1
PED is =1
PED is <1
3
what is a type of market failure
low income
government intervention
surplus of goods
externalities
4
when does the market function most effectively?
with other people's help
sometimes
anytime
left alone
5
externalities are
cost or benefit that falls on the consumers
cost or benefit that falls on the governments
cost or benefit that falls on the producers
cost or benefit that falls on the third party
6
what is this?
inelastic demand
PED
Unit Elastic
elastic demand
7
What are the determinants of Demand
population, price, substitutes, taste&preferences, income
price, income, natural resources, capital, population
price, income, taste&preferences, population, expectations
expectations, population, supply, government, life
8
positive externalities are
benefit to society
benefit to consumers
benefit to producer
benefit to governments
9
consumption (use of) vaccine is
positive externalities
negative externalities
10
What is not the determinants of elastics?
Closeness of compliments
Proportion of Income
Luxury Goods
Closeness of Substitute goods
11
what is shortage
situation where we run out of money
situation where demand is greater than the supply
situation where we run out of products
situation where demand is lower than the supply
12
What is this diagram?
Increase in supply
Inflation
Price Ceiling
Increase in quantity supplied
13
What is the incorrect effect of price ceiling?
shortage
market size shrinks
black market shrinks
elimination of allocation of efficiency
14
What is this diagram?
Increase in demand
Increase in tax collected
Increase in quantity demanded
Increase in supply
15
Scarcity
my bank account
being scarce of supply
unlimited wants, but limited resources
shortage
16
What is the law of demand
A law that determines the amount of products demanded
A relationship between demand and supply
A law set by the government on the demand of the consumers
As price increases the quantity demanded decreases (inverse)
17
what is surplus?
situation where demand is greater than supply
too much products that you run our of storage
situation where demand is less than supply
overflow of $$$
18
Define supply
supply of oreos in your local supermarket
amount supplied to a market at a particular price and time
supply a consumer holds up in their house
amount demanded to be present in the market
19
goods that bring positive externalities are
demerit goods
merit goods
20
What is incorrect effect of tax?
price rises
output reduces
market size shrinks
demand rises
21
What is the definition of elasticity?
sensitivity of purchase in response to change in price
measure of responsivenes in one variable when another change
sensitivity of purchases in response to change in income
how sensitive people's purchases are to changes in price
22
what is the incorrect effect of price floor?
surplus
cost inefficiency
black market increases
shortage
23
Can there is disequilibrium?
NO
YES
24
What is substitution effect?
substituting products supplied in the market
price change that motivates consumers to by cheaper products
you can substitute your role in the market
25
What is not a determinant of supply?
government action
price of substitute goods
weather and natural devastations
taste and preferences
26
what is not the correct characteristic of indirect tax?
placed on goods and services
Government does not have the right to use indirect tax
collected by sellers and given to the government
An example is cigarrete.
27
Define demand
the amount of goods demanded in the market
the amount of goods that consumers are willing to buy
the amount consumers demand to be present in the market
amount of goods consumers are willing and able to purchase
28
what is the shaded part called?
consumer surplus
producer surplus
29
define a market failure
failure in the economy of an country
situation where the allocation of resources is not efficient
a situation where the market is failing
producers and consumers cannot hold up the market
30
What is the incorrect reason for the government to subsidize?
address a balance of payments deficit by increasing revenue
To support the lower class
support an industry by helping with production cost
increase the consumption of some good by lowering the price
31
Who benefits by rising tax?
consumers
producers
Governments
foreign firms
32
which of the following is not a negative externality (of production and consumption)
weapons
jeans
cigarettes
education
33
when externalities exist
social benefit equals the private benefit
social benefit does not equal private benefit
34
The only thing that changes quantity demanded is
Determinants of demand
Price
35
4 categories of resources
taxes, labour, capital, entrepreneurship
land, labour, money, machines
land, capital, entrepreneurship, government
land, labour, capital, entrepreneurship
36
What is the law of supply
increase in price will lead to increase in quantity supplied
supply must meet demand
law in each supermarket to limit the amount of goods present
law forced on the amount a producer can sell their product
37
What is an incorrect example of situation that price ceiling can be used?
Housing
Education
Health Care
Staple goods
38
what is not a solution to a negative externalities
regulations
advertisements
subsidies
taxes
39
What is this diagram
Increase in taxes
Increase in supply
Supply Shock
Increase in quantity supplied
40
what is a market
breezeway
where we buy food
where buyers and sellers come together for exchange
where the consumers display their products
41
What is the income effect?
Income limits your choice of purchases
Income affect the amount of tax paied
Income affects the total output of the nation
Income affects the Standard of living
42
What is this diagram?
Increase in quantity demanded
Increase in quantity supplied
Shortage
Increase in demand
43
The law of diminishing marginal utility
decrease in demand of products
if you have a lot, its is useless
consuming more product eventually gets less satisfaction
44
what is equilibrium
balance between IB and social life
when demand of consumer = supply of producers
balance in you payment and income
balance of your economic life
45
The following statement maximum price for a good set by the government defines
price ceiling
price floor
shortage
price roof

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