Exam review 1 ECON203

The Marginal rate of substitution is the rate at which a consumer is willing to trade one good for another

With an Inferior Good, an increase in income will lead to a decrease in demand

Prices are actually the result of individuals making rationally max. choices, hence they are NOT a haphazard process

Equilibrium Prices are often referred to as:

What is everything a seller must give up to produce a good?

Social Planner traditionally would focus on:

A measure of the reponsiveness of quantity demanded or quantity supplied is called:

Economists generally love price controls

An example of inelastic demand would be:

Expectations about the future have no bearing on Supply or Demand

The entire market's derived willingness to pay for a particular good or service is called a Demand Schedule

A legal maximum on the price at which a good can be sold is called a:

Prices are generally the result of government policies and guidelines:

The amount a buyer is willing to pay for a good minus the amount the buyer actually pays is called:

An indifference curve shows consumption bundles that give the consumer the different levels of satisfaction

Theoretically, the most important influence on Supply is:

In a perfeclty competitive market, buyers and sellers are:

Which economist put gained fame for writing the book The Economic Consequences of the Peace and became famous?

A cost in a market that affects more than just the buyer and sellers is referred to as:

When the price of a good rises, the quantity demanded falls is the axiomatic definition of:

When Quantity Demanded responds substantially to a change in price, the demand is considered inelastic

The limit on the consumption bundles that a consumer can afford is called a

Goods that have close substitutes generally have less elastic demand:

Actual Elasticities that can be calculated include all but:

Consumer Surplus is graphically represented by the area below the demand curve but above the price

What is represented by the area below the price and above the supply curve?

A Demand Curve will generally have a negative slope

A benevolent social planner would focus on:

Variables that can shift the Demand Curve are all except:

A non-binding price control will materially affect the market's equilibrium