Lecture 3: Free Markets, Voluntary Exchange, and Money
|
|
- Baldric Nathaniel Hall
- 5 years ago
- Views:
Transcription
1 Lecture 3: Free Markets, Voluntary Exchange, and Money Session ID: DDEE EC101 DD & EE / Manove Market System>Money p 1 EC101 DD & EE / Manove Clicker Question p 2
2 Economics Systems Different cultures have different economic systems with different rules or codes of behavior. EC101 DD & EE / Manove Economic Concepts>Economic Systems p 3 In some places, the entire economy works like the army: orders are passed down from the top. In other places, the economy is completely decentralized: families run their own businesses any way they want. Some standard examples are: Feudalism and Serfdom The Command Economy (former Soviet Union) Free Market System But many other economic systems have been described. [Read about the Incas in the course website.] EC101 DD & EE / Manove Economic Concepts>Economic Systems p 4
3 Basic Economic Choices As a group, economic agents must make a number of important economic choices: What to produce How to produce it Production decisions Who gets the outputs Who provides the inputs Distribution decisions In different economic systems, these decisions are made in different ways. EC101 DD & EE / Manove Economic Concepts>Economic Choices p 5 Free-Market System In the free-market economic system, most economic activity is voluntary induced by economic incentives. Production voluntary activity of private firms. Distribution voluntary exchange EC101 DD & EE / Manove Free-Market System p 6
4 Example: Shanu s Pizza Palace Shanu opens a pizza restaurant (voluntary production). She leases space, buys ovens (voluntary exchange). She hires workers at $12/hour (voluntary exchange). They produce pizza (voluntary production). Shanu sells pizza to customers (voluntary exchange). EC101 DD & EE / Manove Free-Market System>Example p 7 Real Free-Market Economies Most countries, even countries with communist governments, now have free-market economies. They rely mainly on the voluntary economic activities of households and private firms. But real free-market economies also include involuntary private exchange and production government production, induced by a combination of political and economic incentives EC101 DD & EE / Manove Free-Market System>EC101 p 8
5 Involuntary Economic Activities Example: Shanu s Pizza Palace (again) Shanu must pay taxes to the local government, The local health authorities require her to keep her restaurant kitchen very clean. She must not allow smoking in her restaurant. EC101 DD & EE / Manove Free-Market System>Deviations p 9 Example: Even in the US, governments operate many firms. universities schools. Government Production EC101 DD & EE / Manove Free-Market System>Countries p 10
6 EC101 DD & EE / Manove Clicker Question p 11 The Free-Market System and EC 101 Real free-market economies are difficult to analyze. So in EC101 we spend a lot of time on the free-market model. In the model, all economic activities are private and voluntary (arising from economic incentives). The model may help us understand the real world. But the results of the model aren t always realistic. EC101 DD & EE / Manove Free-Market System>EC101 p 12
7 Voluntary Exchange Voluntary exchange is usually used in freemarket economies to distribute outputs and inputs. Households, firms and governments sell and buy (exchange) goods and services. Voluntary exchange usually increases the welfare of both parties, or, at least, doesn t normally decrease it, because people don t tend to do things voluntarily that make them worse off. Most voluntary exchange takes place in markets. EC101 DD & EE / Manove Market System>Voluntary Exchange p 13 Markets Markets are meeting places for voluntary exchange. Traditional markets Supermarkets NASDAQ: a virtual meeting place EC101 DD & EE / Manove Market System>Voluntary Exchange>Markets p 14
8 Some markets are diffuse and exist in many places simultaneously. market for petroleum US labor market (one market or many?) EC101 DD & EE / Manove Market System>Voluntary Exchange>Markets p 15 Voluntary Exchange Examples Example 1: You have but prefer I have but prefer Outcome: We trade voluntarily. We are both better off. EC101 DD & EE / Manove Market System>Voluntary Exchange>Examples p 16
9 Example 2: You have and prefer I have and prefer Outcome: We do not trade. Our welfare EC101 DD & EE / Manove Market System>Voluntary Exchange>Examples p 17 Example 3: You have and prefer I have and prefer Outcome: You want to trade, But I say no. We don t trade..??? EC101 DD & EE / Manove Market System>Voluntary Exchange>Examples p 18
10 Example 4: You have and prefer Outcome: You want to trade, But I don t want to. So you tell me that oranges are better for my health.??? I have and prefer EC101 DD & EE / Manove Market System>Voluntary Exchange>Examples p 19 Voluntary Exchange: Moral Voluntary exchange tends to make agents better off, because it is voluntary. It never makes agents worse off (well, almost never). Important exceptions: EC101 DD & EE / Manove Market System>Voluntary Exchange>Moral p 20
11 In most markets, the seller has a lot more information about the product or service than the buyer has. Examples: Voluntary Exchange and Trust There are laws that protect the unsuspecting from the unscrupulous. But voluntary exchange always requires trust, a form of social capital. EC101 DD & EE / Manove Market System>Voluntary Exchange>Moral p 21 Voluntary-Exchange Mechanisms Voluntary exchange is a fundamental aspect of the free market system. But how is voluntary exchange conducted? Two primary mechanisms: Barter Selling and Buying EC101 DD & EE / Manove Market System>Money p 22
12 Exchange Mechanisms: Barter Accomplished in one step Direct Exchange: you have oranges and want apples. Double Coincidence of Wants. You must find a market with people who have what you want and want what you have. EC101 DD & EE / Manove Market System>Voluntary Exchange>Barter p 23 Exchange Mechanisms: Selling & Buying Two steps (rather than one) Selling what you have: Buying what you want EC101 DD & EE / Manove Market System>Voluntary Exchange>Selling&Buying p 24
13 Selling and Buying requires two steps and a special tool (money). But searching for the right market is easier. When you sell, you must find a market with people who want what you have, but they don t have to have what you want. When you buy, you must find a market with people who have what you want, but they don t have to want what you have. EC101 DD & EE / Manove Market System>Voluntary Exchange>Selling&Buying p 25 Advantages of Selling and Buying Being able to find the right market easily is very important in complex economies with millions of goods and services. That s why barter is uncommon in advanced economic systems. EC101 DD & EE / Manove Market System>Voluntary Exchange>Selling&Buying p 26
14 Money Barter requires no special tools, But selling and buying require a medium of exchange: Money Selling means obtaining money in exchange for goods. Buying means obtaining goods in exchange for money. EC101 DD & EE / Manove Market System>Money p 27 Commodity money Salt Gold Types of Money Fiat money declared to be money by the state or other institution often exists only as paper (currency), or as intangible notations in computer memory banks (checkable deposits). Fiat money has no value of its own. EC101 DD & EE / Manove Market System>Money>Types of Money p 28
15 Why do people accept paper money in return for valuable goods and services? We accept paper money from others, because we know that. We can then use the money to buy what we want. The role of legal tender? Bitcoin? Acceptance of Money EC101 DD & EE / Manove Market System>Acceptance of Money p 29 What would happen if I told you Don t accept US dollars they re worthless. But suppose Fed Governor Janet Yellen went on television with President Obama and said What would happen then? EC101 DD & EE / Manove Market System>Acceptance of Money p 30
16 EC101 DD & EE / Manove Clicker Question p 31 End of File EC101 DD & EE / Manove End of File p 32
Lecture 3: Free Markets, Voluntary Exchange, and Money
Lecture 3: Free Markets, Voluntary Exchange, and Money EC101 DD & EE / Manove Market System>Money p 1 Economics Systems Different cultures have different economic systems with different rules or codes
More informationLecture 4: Markets, Prices and Demand
Lecture 4: Markets, Prices and Demand Session ID: DDEE If you haven t registered your smartphone app or clicker in Blackboard, do so later today. It isn t too late. If you aren t using your @bu.edu email
More informationLecture 4: Markets, Prices and Demand
Lecture 4: Markets, Prices and Demand If you plan to stay in the course, and you haven t bought and registered your clicker and clicker subscription, do so this weekend. Follow the instructions on the
More informationLecture 5: Consumer Surplus, Production and Supply
Lecture 5: Consumer Surplus, Production and Supply Session ID: DDEE If you haven t registered your smartphone app or clicker, do so later today. It isn t too late. If you aren t using your @bu.edu email
More informationLecture 9. Consumer Choice and Consumer Welfare
Lecture 9. Consumer Choice and Consumer Welfare Session ID: DDEE EC101 DD & EE / Manove Consumer Choice p 1 EC101 DD & EE / Manove Clicker Question p 2 Consumer Choice How do consumers decide what to purchase?
More informationEC101 DD/EE PRACTICE Midterm 1 October 3, 2017 Version 09
EC101 DD/EE PRACTICE Midterm 1 October 3, 2017 Version 09 Name (last, first): Student ID: U - - Discussion Section: Signature EC101 DD/EE Practice Midterm 1 F17 INSTRUCTIONS (***Read Carefully***): ON
More informationThings people like and desire.
1 Wants 1 Things people like and desire. 2 Needs 2 Things you must have to live. 3 Scarcity 3 When there is not enough for all who want it. 4 Choice 4 To make a decision. 5 Goods 5 Things that can satisfy
More informationINTI COLLEGE MALAYSIA BUSINESS FOUNDATION PROGRAMME ECO 181: INTRODUCTORY ECONOMICS FINAL EXAMINATION: AUGUST 2003 SESSION
ECO 181 (F) / Page 1 of 15 INTI COLLEGE MALAYSIA BUSINESS FOUNDATION PROGRAMME ECO 181: INTRODUCTORY ECONOMICS FINAL EXAMINATION: AUGUST 2003 SESSION SECTION A There are SIXTY questions on this paper.
More informationEC101 DD/EE Midterm 1 October 6, 2016 Version 01
EC101 DD/EE Midterm 1 October 6, 2016 Version 01 Name (last, first): Student ID: U - - Discussion Section: Signature EC101 DD/EE F16 Midterm 1 v1 INSTRUCTIONS (***Read Carefully***): ON YOUR QUESTION BOOKLET:
More information1 Ten Principles of Economics CHAPTER 1 TEN PRINCIPLES OF ECONOMICS 0
1 Ten Principles of Economics CHAPTER 1 TEN PRINCIPLES OF ECONOMICS 0 In this chapter, look for the answers to these questions: What kinds of questions does economics address? What are the principles of
More informationLecture 5: Consumer Surplus, Production and Supply
Lecture 5: Consumer Surplus, Production and Supply If you haven t registered your clicker and subscription, do so later today. It isn t too late. For instructions, see the course-website announcements.
More informationLecture 10: Competition, Producer Surplus and Economic Efficiency
Lecture 10: Competition, Producer Surplus and Economic Efficiency If you received an email that your clicker account is not active, be sure to register the account on Blackboard! Competition p 1 A consumer
More informationEC101 DD/EE Midterm 1 October 3, 2017 Version 04
EC101 DD/EE Midterm 1 October 3, 2017 Version 04 Name (last, first): Student ID: U - - Discussion Section: Signature EC101 DD/EE Midterm 1 F17 INSTRUCTIONS (***Read Carefully***): ON YOUR QUESTION BOOKLET:
More informationThe study of how people choose to use scarce resources to satisfy unlimited wants is called
Final Exam Review The study of how people choose to use scarce resources to satisfy unlimited wants is called Economics The benefit gained from the use of a good or services is called The benefit gained
More informationLecture 14: Externalities
Lecture 14: Externalities EC101 DD & EE / Manove Externalities p 1 EC101 DD & EE / Manove Clicker Question p 2 Externalities A rational agent undertaking an economic activity considers the effect of the
More informationEC101 DD/EE Midterm 2 November 7, 2017 Version 01
EC101 DD/EE Midterm 2 November 7, 2017 Version 01 Name (last, first): Student ID: U Discussion Section: Signature EC101 DD/EE F17 Midterm 2 INSTRUCTIONS (***Read Carefully***): ON YOUR QUESTION BOOKLET:
More informationEC101 DD/EE Midterm 2 November 7, 2017 Version 04
EC101 DD/EE Midterm 2 November 7, 2017 Version 04 Name (last, first): Student ID: U Discussion Section: Signature EC101 DD/EE F17 Midterm 2 INSTRUCTIONS (***Read Carefully***): ON YOUR QUESTION BOOKLET:
More informationChapter 2: Economic Systems Section 2
Chapter 2: Economic Systems Section 2 Objectives 1. Explain why markets exist. E3, 5, 9 2. Analyze a circular flow model of a free market economy. E6, 3. Describe the self-regulating nature of the marketplace.
More informationLecture 20: Price Discrimination, Monopoly Rents and Social Surplus
Lecture 20: Price Discrimination, Monopoly Rents and Social Surplus Session DDEE EC101 DD & EE / Manove Monopoly p 1 EC101 DD & EE / Manove Clicker Question p 2 Example: Monopoly Profit Maximization (The
More informationModule 11: A Simple Model of Reputation - Moral Hazard and Product Quality
Module 11: A Simple Model of Reputation - Moral Hazard and Product Quality Information Economics (Ec 515) George Georgiadis Consider a firm that sells an experience good. Experience good: product or service
More informationTen Principles of Economics
Seventh Edition Principles of Economics N. Gregory Mankiw CHAPTER 1 Ten Principles of Economics In this chapter, look for the answers to these questions What kinds of questions does economics address?
More informationLecture 8. Other Types of Elasticity
Lecture 8. Other Types of Elasticity Session ID: DDEE Students who have or who expect to have accommodation letters from BU Disability Services should email me immediately at manove@bu.edu with EC101 Accommodations
More informationq S pq S cq S. where q is the total amount produced/consumed. There are two representative firms that maximizes their profits, max pq 1 c 2 q2 1 q 1
Market design, problem set 2 (externalities, incomplete information, search) Do five of nine. 1. There is a representative consumer who picks a quantity q D to imize his utility, b log(q D ) pq D + w X
More informationMULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question.
Chapters 1-3: Additional Questions MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question. 1) A recurring theme in economics is that people: A) Can increase
More informationChapter 02 The Market System and the Circular Flow
Chapter 02 The Market System and the Circular Flow Multiple Choice Questions 1. The market system is an economic system that: A. Produces more consumer goods than capital goods B. Produces more capital
More informationMULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question.
Chapters 2-4: Additional Questions MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question. 1) The market system is also known as: A) Central planning B) Production
More informationChapter 2: Economic Systems
2-1 Summary: Fill in the missing words. Because economic resources are limited, a country must answer three key economic questions. These are: 1)? 2)? 3)? In answering these questions, societies must consider
More informationJANUARY EXAMINATIONS 2008
No. of Pages: (A) 9 No. of Questions: 38 EC1000A micro 2008 JANUARY EXAMINATIONS 2008 Subject Title of Paper ECONOMICS EC1000 MICROECONOMICS Time Allowed Two Hours (2 Hours) Instructions to candidates
More informationEC101 DD/EE Practice Midterm 2 November 7, 2016 Version Z
EC101 DD/EE Practice Midterm 2 November 7, 2016 Version Z Name (last, first): Student ID: U Discussion Section: Signature EC101 DD/EE Practice Midterm 2 INSTRUCTIONS (***Read Carefully***): ON YOUR QUESTION
More informationDefine what is bartering and identify the major problems with this type of system. Identify the three main functions of money. Distinguish between
Define what is bartering and identify the major problems with this type of system. Identify the three main functions of money. Distinguish between the different types of money and their different purposes.
More informationEC101 DD/EE Practice Final December 16/19, 2017 Version 09
EC101 DD/EE Practice Final December 16/19, 2017 Version 09 Name (last, first): Student ID: U - - Discussion Section: Signature EC101 DD/EE Practice Final F17 INSTRUCTIONS (***Read Carefully***): ON YOUR
More informationMACROECONOMICS - CLUTCH CH AGGREGATE DEMAND AND AGGREGATE SUPPLY ANALYSIS
!! www.clutchprep.com CONCEPT: AGGREGATE DEMAND The aggregate demand and aggregate supply model (AD-AS Model) explains short-run fluctuations in GDP and price Aggregate Demand is closely related to our
More informationMoney, prices and exchange rates in the long run
Money, prices and exchange rates in the long run Outline Part I: Money and inflation 1. Definition of money 2. Money supply and money demand 3. The neutrality of money 4. The dichotomy principle and its
More informationLecture 21: Strategic Interaction and Game Theory
Lecture : Strategic Interaction and Game Theory EC DD & EE / Manove Strategic Interaction p EC DD & EE / Manove Clicker Question p Strategic Interaction In perfectly competitive markets (like the market
More informationEastern Mediterranean University Faculty of Business and Economics Department of Economics Fall Semester
Duration: 50 minutes Eastern Mediterranean University Faculty of Business and Economics Department of Economics 2016-17 Fall Semester ECON101 - Introduction to Economics I Quiz 2 Answer Key 16 December
More informationWhat is money? What does it do? Why do we need it? In today s world, very few people can for themselves all the things they need and want.
What is money? What does it do? Why do we need it? In today s world, very few people can for themselves all the things they need and want. In fact, most people must buy almost all the goods and services
More informationLarry Phipps. Pricing Professional Services. Who is Larry Phipps? What we will NOT be discussing ISPLS Convention. Pricing Professional Services
Presented by Larry Phipps NCPLS and President larry@landsurveys.com Who is Larry Phipps? BS in Forestry NC State 1980 BS in Wildlife Biology NC State 1980 NC SIT 1984 NC PLS 1986 Founded Phipps Surveying
More informationFairtrade FACT-FILE. What does Fairtrade mean? How does Fairtrade work? Do these farmers really need our help?
FACT-FILE What does mean? means just what it says: it s trade that is fair. Trade is the exchange of goods between countries and companies around the world. They exchange the goods that they produce, including
More informationFINAL. January 17, 2011 GROUP A
EC101 Sections 04 Fall 2010 NAME: ID #: SECTION: Instructions: FINAL January 17, 2011 GROUP A You have 90 minutes to complete the exam. There will be no extensions. Students are not allowed to go out of
More informationMini-Economy Test. Grades 4-6, STUDENT Version
Mini-Economy Test Grades 4-6, STUDENT Version For questions 1 10, choose one word from the box below that best fits the sentence. You will not use all the words, so don t worry if you have words left over.
More informationWelfare Economics. The Edgeworth Box. The Basic Theorem. Some Basic Assumptions
Welfare Economics The Edgeworth Box The Basic Theorem The basic theorem in welfare economics: A market, exchange, economy will achieve efficient resource allocation. We intend to show the basics of that
More informationAlso, big thank you to fellow TA Enoch Hill for edits and some additions to the guide.
Hello class, once again, here s an unofficial guide to the sample midterm. Please use this with caution, since 1) I am prone to error so incorrect explanations are entirely possible and 2) you should do
More information- Scarcity leads to tradeoffs - Normative statements=opinion - Positive statement=fact with evidence - An economic model is tested by comparing its
Macroeconomics Final Notes: CHAPTER 1: What is economics? We want more than we can get. Our inability to satisfy all of our wants is called scarcity. All resources are finite even if they are abundant.
More informationReading Essentials and Study Guide
Lesson 3 Using Economic Models ESSENTIAL QUESTION In what ways do people cope with the problem of scarcity? Reading HELPDESK Academic Vocabulary mechanism process or means by which something can be accomplished
More informationEC101 DD/EE Midterm 2 November 5, 2015 Version
EC101 DD/EE Midterm 2 November 5, 2015 Version Name (last, first): Student ID: U Discussion Section: Signature EC101 Midterm 2 F2015 INSTRUCTIONS (***Read Carefully***): ON YOUR QUESTION BOOKLET: Fill
More informationEC101 DD/EE Practice Midterm 2 November 6, 2014 Version
EC101 DD/EE Practice Midterm 2 November 6, 2014 Version Name (last, first): Student ID: U Discussion Section: Signature EC101 DD/EE F14 Practice Midterm 2 INSTRUCTIONS (***Read Carefully***): ON YOUR QUESTION
More informationCHAPTER 2 The Market System and the Circular Flow
Microeconomics 21st Edition McConnell Test Bank Full Download: http://testbanklive.com/download/microeconomics-21st-edition-mcconnell-test-bank/ CHAPTER 2 The Market System and the Circular Flow A. Short-Answer,
More informationLecture 10: Competition, Producer Surplus and Economic Efficiency
Lecture 10: Competition, Producer Surplus and Economic Efficiency Competition p 1 Clicker Question p 2 Price Setters and Price Takers A seller is called a price taker if she accepts a price set by others
More informationLecture 7. Elasticity of Demand
Lecture 7. Elasticity of Demand Session ID: DDEE Supply & Demand>Shifts p 1 Clicker Question p 2 So far we ve seen that On the demand curve, when the price rises, the quantity demanded falls. On the supply
More information2, 1 EE CONOMIC SYSTEMS
2, 1 For use with textbook pages 31 38 EE CONOMIC SYSTEMS KEY TERMS economic system The way in which a nation uses its resources to satisfy its people s needs and wants (page 31) traditional economy A
More informationReading Essentials and Study Guide
Lesson 3 Using Economic Models ESSENTIAL QUESTION In what ways do people cope with the problem of scarcity? Reading HELPDESK Academic Vocabulary mechanism process or means by which something can be accomplished
More informationCopyright 2016 Pearson Canada Inc. 5-1 EFFICIENCY AND EQUITY. After studying this chapter, you will be able to:
5 EFFICIENCY AND EQUITY After studying this chapter, you will be able to: Describe the alternative methods for allocating scarce resources Explain the connection between demand and marginal benefit and
More informationChapter 11 Technology, Production, and Costs
Economics 6 th edition 1 Chapter 11 Technology, Production, and Costs Modified by Yulin Hou For Principles of Microeconomics Florida International University Fall 2017 Technology: An Economic Definition
More informationTen Principles of Economics
C H A P T E R 1 Ten Principles of Economics Economics P R I N C I P L E S O F N. Gregory Mankiw Premium PowerPoint Slides by Ron Cronovich 2009 South-Western, a part of Cengage Learning, all rights reserved
More informationChapter 5. Market Equilibrium 5.1 EQUILIBRIUM, EXCESS DEMAND, EXCESS SUPPLY
Chapter 5 Price SS p f This chapter will be built on the foundation laid down in Chapters 2 and 4 where we studied the consumer and firm behaviour when they are price takers. In Chapter 2, we have seen
More informationIt's the. E c n my. A Hot topics Hot Serials Newspaper supplement from SUPPLEMENT FROM
It's the E c n my A Hot topics Hot Serials Newspaper supplement from SUPPLEMENT FROM TheEcon my What Does It All Mean? Economics is the study of how individuals, groups, or nations allocate their limited
More informationMacroeonomics. Ten Principles of Economics. In this chapter, look for the answers to these questions: What Economics Is All About. N.
C H A P T E R 1 In this chapter, look for the answers to these questions: Ten Principles of Economics P R I N C I P L E S O F Macroeonomics N. Gregory Mankiw Premium PowerPoint Slides by Ron Cronovich
More informationEC101 DD/EE Practice Final December 17/20, 2016 Version 09
EC101 DD/EE Practice Final December 17/20, 2016 Version 09 Name (last, first): Student ID: U - - Discussion Section: Signature EC101 DD/EE Practice Final F16 INSTRUCTIONS (***Read Carefully***): ON YOUR
More informationTen Principles of Economics
Wojciech Gerson (1831-1901) Seventh Edition Principles of Economics N. Gregory Mankiw CHAPTER 1 Ten Principles of Economics In this chapter, look for the answers to these questions What kinds of questions
More informationNAME DATE CLASS. In the first column, answer the questions based on what you know before you study. After this lesson, complete the last column.
NAME DATE CLASS Lesson 1: Gross Domestic Product ESSENTIAL QUESTION Why and how do people make economic choices? GUIDING QUESTIONS 1. Why is Gross Domestic Product important to a nation? 2. Why is GDP
More informationTen Principles of Economics
Wojciech Gerson (1831-1901) Seventh Edition Principles of Macroeconomics N. Gregory Mankiw The principles of HOW PEOPLE MAKE DECISIONS CHAPTER 1 Ten Principles of Economics lithian/shutterstock.com In
More informationAN INTERVIEW WITH MR. MARKET AND MS. COMMAND
ACTIVITY 1 Today, we have with us two people who represent two types of economic systems: Mr. Market Economy and Ms. Command Economy. They are going to tell us about how they are similar and different.
More information13-1 L ECTURE LAUNCHER PAGES PAGES
13-1 L ECTURE LAUNCHER When Hurricane Andew blew through Southern Florida it was a disaster, but the GDP recorded it as a $15 billion boon to the economy. What does GDP measure? Under what circumstances
More informationGA quiz ECONOMICS 1. Copyright 2014 by MBA Research and Curriculum Center, Columbus, Ohio
GA quiz ECONOMICS 1 1. Why is it important for businesses to monitor customer purchases? A. To satisfy consumers' needs and wants B. To block consumers' economic votes C. To promote slow-selling merchandise
More informationBitcoin can be used to buy things electronically. In that sense, it s like conventional dollars, Euros, or yen, which are also traded digitally.
BITCOIN 02/01/2018 BITCOIN Bitcoin is a form of digital currency, created and held electronically. No one controls it. Bitcoins aren t printed, like dollars or Euros they re produced by people, and increasingly
More information(cl Economic concept necessitating choices and priorities in any ~ociety:
NAME---------------------------------- CLASS -------- DATE ------------- A. As You Read As you read Section 1, supply the missing information about economic systems in the spaces provided. 1. Three economic
More informationECONOMICS SOLUTION BOOK 2ND PUC. Unit 5
Unit 5 I. Choose the correct answer (each question carries 1 mark) 1. In perfect competition, buyers and sellers are: a) Price makers b) Price takers c) Price analysts d) None of the above 2. A situation
More informationECONOMICS- The study of the ways societies choose to use their limited resources.
ECONOMICS ECONOMICS- The study of the ways societies choose to use their limited resources. SCARCITY- Goods and services are not available in unlimited amounts. OPPORTUNITY COST: We must decide to give
More informationchapter: Solution Factor Markets and the Distribution of Income
Factor Markets and the Distribution of Income chapter: 19 1. In 2010, national income in the United States was $11,722.6 billion. In the same year, 139 million workers were employed, at an average wage
More informationECONOMICS REVIEW FINAL EXAM
ECONOMICS REVIEW FINAL EXAM UNIT 1 INTRO TO ECONOMICS FINAL EXAM REVIEW Unit 1 Economics is the study of how people satisfy their wants and needs when there are limited, or scarce, resources Microeconomics
More informationChapter 6:3: The Role of Prices
Chapter 6:3: The Role of Prices In this section, we will see how prices affect consumer behavior and how producers respond. 1Co_6:20 For ye are bought with a price: therefore glorify God in your body,
More informationEC101 DD/EE Final Exam December 16, 2017 Version 03
EC101 DD/EE Final Exam December 16, 2017 Version 03 Name (last, first): Student ID: U - - Discussion Section: Signature EC101 EE Final Exam F17 INSTRUCTIONS (***Read Carefully***): ON YOUR QUESTION BOOKLET:
More informationEC101 DD/EE Final Exam December 16, 2017 Version 01
EC101 DD/EE Final Exam December 16, 2017 Version 01 Name (last, first): Student ID: U - - Discussion Section: Signature EC101 EE Final Exam F17 INSTRUCTIONS (***Read Carefully***): ON YOUR QUESTION BOOKLET:
More informationEC101 DD/EE Final Exam December 16, 2017 Version 02
EC101 DD/EE Final Exam December 16, 2017 Version 02 Name (last, first): Student ID: U - - Discussion Section: Signature EC101 EE Final Exam F17 INSTRUCTIONS (***Read Carefully***): ON YOUR QUESTION BOOKLET:
More informationChapter 6: Prices Section 1
Chapter 6: Prices Section 1 Key Terms equilibrium: the point at which the demand for a product or service is equal to the supply of that product or service disequilibrium: any price or quantity not at
More informationEconomics 422: Monetary Economics. Lecture Notes
Economics 422: Monetary Economics Lecture Notes Winter 2010 Allen Head Department of Economics Queen s University These notes draw extensively from the book, Modeling Monetary Economies, 2nd ed., by Bruce
More informationChapter 11. Microeconomics. Technology, Production, and Costs. Modified by: Yun Wang Florida International University Spring 2018
Microeconomics Modified by: Yun Wang Florida International University Spring 2018 1 Chapter 11 Technology, Production, and Costs Chapter Outline 11.1 Technology: An Economic Definition 11.2 The Short Run
More informationFigure 4 1 Price Quantity Quantity Per Pair Demanded Supplied $ $ $ $ $10 2 8
Econ 101 Summer 2005 In class Assignment 2 Please select the correct answer from the ones given Figure 4 1 Price Quantity Quantity Per Pair Demanded Supplied $ 2 18 3 $ 4 14 4 $ 6 10 5 $ 8 6 6 $10 2 8
More information2 The Economic Problem
2 The Economic Problem Production Possibilities and Opportunity Cost The production possibilities frontier (PPF) is the boundary between those combinations of goods and services that can be produced and
More informationUnit 7 Problem Set. b. Suppose that a huge wave of corporate downsizing leads many terminated employees to open their own businesses.
Goldwasser AP Microeconomics NAME Unit 7 Problem Set 1. In 2007, national income in the United States was $11,186.9 billion. In the same year, 137 million workers were employed, at an average wage of $57,526
More informationEcon : Principles of Microeconomics Midterm practice problems
Econ 1101-005: Principles of Microeconomics Midterm practice problems The following four questions consider the market for widgets. For each of the following situations, determine what happens to the equilibrium
More informationUnit One, Day One (pages 6-20, 28) ECONOMICS: The study of how limited productive resources are efficiently allocated in a world of unlimited wants.
Unit One, Day One (pages 6-20, 28) ECONOMICS: The study of how limited productive resources are efficiently allocated in a world of unlimited wants. SCARCITY: WANTS EXCEED RESOURCES We want more than we
More informationChapter 2: Economic Systems. 1. Answering three Economic Questions. 2. The Free Market 3. Centrally Planned Economics 4.
1 Chapter 2: Economic Systems 1. Answering three Economic Questions? 2. The Free Market 3. Centrally Planned Economics 4. Mixed Economics 1. Answering three Economic Questions What goods and services should
More informationLecture 21: Strategic Interaction and Game Theory
Lecture 2: Strategic Interaction and Game Theory EC DD & EE / Manove Strategic Interaction p What types of firms are most likely to engage in costly rent-seeking? EC DD & EE / Manove Monopoly>Rent Seeking
More informationAGS Economics Michigan High School Content Expectations for Economics
AGS 2005 Correlated to Michigan High School Content Expectations for 5910 Rice Creek Pkwy, Suite 1000 Shoreview, MN 55126 Copyright 2007 Pearson Education, Inc. or its affiliate(s). All rights reserved.
More informationCHAPTER 2. 4) Taxes cause: a) Market distortions b) Reduce incentives to work c) Decrease wealth creating transactions d) All of the above ANS: D
CHAPTER 2 1) When the market is in equilibrium, a) Total surplus is minimized b) Total surplus is maximized without government intervention c) Government maximizes total revenue 2) The difference between
More informationHow Can Entrepreneurs Control Costs? Council for Economic Education, New York, NY Entrepreneurship in the U.S. Economy, Lesson 20
How Can Entrepreneurs Control Costs? Council for Economic Education, New York, NY Entrepreneurship in the U.S. Economy, Lesson 20 Lesson Description DESCRIPTION In this lesson students will learn that
More informationA to Z. Guide. How to Avoid the Biggest Mistakes.
A to Z CRYPTO MINING Guide How to Avoid the Biggest Mistakes 1 INTRODUCTION Has the hype already caught up to you and you re ready to start mining some crypto with your fresh, new mining rig? Or maybe
More informationStandard CE.11a Economic Concepts
Standard CE.11a Economic Concepts 1. Scarcity is the inability to satisfy all wants at the same time. All resources and goods are limited. This requires that choices be made. 2. Resources are factors of
More information1 TEN PRINCIPLES OF ECONOMICS
1 TEN PRINCIPLES OF ECONOMICS LEARNING OBJECTIVES: By the end of this chapter, students should understand: that economics is about the allocation of scarce resources. that individuals face tradeoffs. the
More informationChapter. Demand and Supply CHAPTER IN PERSPECTIVE
Demand and Supply Chapter 4 CHAPTER IN PERSPECTIVE The tools of demand and supply explain how competitive markets work. We use the demand and supply tools to determine the quantities and prices of the
More informationChapter One (cont ) Economics is defined as: The science that studies the choices people make in a world of scarcity
Economics Review Chapter One Wants exceed resources to fill wants Therefore scarcity exists Therefore we must make choices Every time we make a choice, we leave behind an opportunity cost, the most likely
More informationECON 1000 Contemporary Economic Issues (Summer 2018) How a Market System Functions
ECON 1 Contemporary Economic Issues (Summer 218) How a Market System Functions Relevant Readings from the Required Textbooks: Chapter 4, Organizing Principles of Capitalist Systems Coda, I, Pencil Definitions
More informationCHAPTER 2 ECONOMIC SYSTEMS, RESOURCE ALLOCATION, AND SOCIAL WELL-BEING: LESSONS FROM CHINA'S TRANSITION
CHAPTER 2 ECONOMIC SYSTEMS, RESOURCE ALLOCATION, AND SOCIAL WELL-BEING: LESSONS FROM CHINA'S TRANSITION LESSONS FROM CHINA S TRANSITION The transition of China s economy from centralized planning to a
More informationCE.11 The student will demonstrate knowledge of how economic decisions are made in the marketplace by
Objectives CE.11 The student will demonstrate knowledge of how economic decisions are made in the marketplace by a) applying the concepts of scarcity, resources, choice, opportunity cost, price, incentives,
More informationProfessor Christina Romer SUGGESTED ANSWERS TO PROBLEM SET 1
Economics 2 Spring 2017 rofessor Christina Romer rofessor David Romer SUGGESTED ANSWERS TO ROBLEM SET 1 1.a. The opportunity cost of a point on your economics exam is 2 points on your chemistry exam. It
More information/
SAMPLE QUESTION PAPER 3 ECONOMICS Class XII Time allowed: 3hrs Maximum Marks: 100 General Instructions: a) All questions are compulsory. b) The question paper comprises of two sections, A and B. You are
More information9. The term "laissez faire" suggests that: A. land and other natural resources should be privately owned, but capital should be publicly owned. B.
02 Student: 1. The command system is also known as: A. market system. B. pure capitalism. C. market socialism. D. socialism or communism. 2. The economy of the former Soviet Union was best described as:
More informationOutlining the Chapter
Outlining the Look over the chapter for an overview of the material. Pay attention to the main topics in the book. As you look over each section of the book, fill in the missing words in the outline below.
More information