AP Microeconomics Ch. 1-3 Review

Question 1

When buying more of a product will bring less satisfaction

Accepted Answer

Diminishing marginal utility

Question 2

Also known as capitalism

Accepted Answer

Market system

Question 3

Also known as "pure capitalism"

Accepted Answer

Laissez-faire capitalism

Question 4

Change in income determines...

Accepted Answer

Demand

Question 5

Excess demand

Accepted Answer

Shortage

Question 6

Change in the number of buyers impact...

Accepted Answer

Demand

Question 7

Shows amounts of a product that consumers are willing and able to purchase at different prices

Accepted Answer

Demand

Question 8

Four main economic resource categories

Accepted Answer

Land, labor, capital, entrepreneurial ability

Question 9

Curve that shows different combos of goods and services produced in a fully employed economy

Accepted Answer

Production possibilities curve

Question 10

The concept that economic wants exceed economics means is called...

Accepted Answer

Economizing problem

Question 11

A minimum price fixed by the government

Accepted Answer

Price floor

Question 12

An inverse relationship between price and quantity demanded

Accepted Answer

Law of demand

Question 13

Describes the flows for a simplified economy without government

Accepted Answer

Circular Flow Model

Question 14

A statement that focuses on facts and what is of economics

Accepted Answer

Positive economics

Question 15

Impacts the purchasing power of a consumer

Accepted Answer

Income effect

Question 16

Resource prices determine...

Accepted Answer

Supply

Question 17

Also known as socialism or communism

Accepted Answer

Command system

Question 18

Product whose demand varies directly with money income

Accepted Answer

Normal goods

Question 19

A decrease in supply and a decrease in demand will...

Accepted Answer

Decrease equilibrium quantity

Question 20

The motivating force of various economic units as they express free choices

Accepted Answer

Self-interest

Question 21

The price where intentions of buyers and sellers match

Accepted Answer

Equilibrium price

Question 22

Change in taxes/subsidies impact...

Accepted Answer

Supply

Question 23

The ability to produce a particular good or service at a lower opportunity cost than another

Accepted Answer

Comparative advantage

Question 24

An increase in supply and decrease in demand will...

Accepted Answer

Decrease equilibrium price

Question 25

This theory finds that producers always end up working in society's best interest

Accepted Answer

The "Invisible Hand"

Question 26

The production of any good in the least costly way

Accepted Answer

Productive efficiency

Question 27

Comparing marginal benefits to marginal costs

Accepted Answer

Marginal analysis

Question 28

The particular mix of goods and services most highly valued by society

Accepted Answer

Allocative efficiency

Question 29

Change in demand is dictated when

Accepted Answer

A consumer's mind has been changed in some way

Question 30

Supply is based on the...

Accepted Answer

Producers

Question 31

Excess supply

Accepted Answer

Surplus

Question 32

Normative economics focus on...

Accepted Answer

Value judgements

Question 33

A schedule or curve that shows combinations of two products to purchase with specific income

Accepted Answer

Budget line

Question 34

A maximum legal price a seller can charge for a product or service

Accepted Answer

Price ceiling

Question 35

As production of a good increases, so does the opportunity cost of each additional unit.

Accepted Answer

Law of increasing opportunity costs

Question 36

Products whose demand varies inversely with money income

Accepted Answer

Inferior good

Question 37

The ability to produce more of a product using less of a resource than a competing firm

Accepted Answer

Absolute advantage

AP Microeconomics Ch. 1-3 Review

Questions 37

AP Microeconomics Ch. 1-3 Review

Questions 37