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Micro 1. Intro to Microeconomics Flashcards | StudBud
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Micro 1. Intro to Microeconomics
Most of economic theory ...
An increase in supply means ...
Micro 1. Intro to Microeconomics
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StudBud Administration
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Principles, Supply&Demand, Elasticity
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1
An increase in supply means ...
a movement along the demand curve
a movement along the supply curve
a leftward shift of the supply curve
a rightward shift of the supply curve
2
Most of economic theory ...
assumes people act rationally to maximize their own interest
views individuals as home economists
views charitable human actions as especially moral
assumes that groups of people often behave irrationally
3
Which of the following is the best definition of opportunity cost?
amount of input used to produce one more unit of a good
the price to be charged in order to sell one more unit
money to be paid to purchase one more unit of a good
amount of A to be given up to produce one more unit of B
4
Microeconomics is not concerned with ...
the quantities of each good produced
microeconomics is concerned with all of the above
the distribution of goods among households
the size of aggregate money flows in the economy
5
The more responsive quantity demanded is to a change in price ...
the more inelastic is the supply curve
the more inelastic is the demand curve
the more elastic is the demand curve
the more elastic is the supply curve
6
People usually respond to incentives ...
exploiting opportunities to make themselves better off
exploiting opportunities to make themselves worse off
not exploiting opportunities to make others better off
not exploiting opportunities to make themselves better off
7
The war on drugs is hard to win because ...
demand for most illegal drugs is inelastic
demand for most illegal drugs is a sin
demand for most illegal drugs is elastic
demand for most illegal drugs is ilegal
8
The relationship between two complementary goods is best represented by the following:
increases in the price of A lead to increases in demand of B
decreases in the price of A lead to increases in demand of B
decreases in the price of A lead to decreases in demand of B
increases in the price of B lead to increases in demand of A
9
All of the following basic economic questions deal with microeconomics except ...
Is the capacity to produce goods growing over time?
How is the supply of goods allocated among individuals?
What goods and services are produced and in what quantities?
By what methods are goods and services being produced?
10
Is an increase in the price of cheese likely to have the following effects?
increase in demand for peanut butter (a substitute good
decrease in the supply of pizza
all of the above will occur
decrease in the quantity demanded of cheese
11
Inefficiency ...
implies the existence of economic inequity
occurs when someone is better off while making others suffer
exists when all resources available are used
implies that more total output could always be produced
12
When a decrease in the price of A leads to a decrease in the demand of B ...
we say those goods are substitutes
we say those goods are normal products
we say those goods are complements
we say those goods are inferior goods
13
A fall in the price of raw milk, used in the production of ice cream, will ...
have no effect on the supply of ice cream at all
decrease the supply of ice cream
increase the supply of ice cream
have no effect on the total cost of ice cream
14
A technological innovation usually ...
increases costs and increases supply
increases costs and decreases supply
lowers costs and increases supply
lowers costs and decreases supply
15
Which of the following is a positive statement?
An unemployment rate of 7 percent is a national disgrace
Unemployment is not so important a problem as inflation
When unemployment is 7%, youth unemployment is close to 40%
Unemployment and inflation are equally important problems
16
An inferior good is characterized as a good whose demand ...
increases when income increases
decreases when income decreases
decreases when income increases
increases when income remains the same
17
When QS = QD at a certain price, the market is ...
hot
not in equilibrium
at peace
in equilibrium
