Keeping private businesses from losing money.
Keeping economics professors from starving to death.
Choices that are made in seeking to use scarce resources efficiently.
Determining the most equitable (fair) distribution of the government's money.
Is an example of irrational behavior.
Implies that reading should be taught through phonics rather than the whole language method.
Contradicts the economic perspective.
Implies that, for most people, the marginal benefit of reading a second newspaper is less than the marginal cost.
Allow one to reason about the relationship between price and quantity of X without the intrusion of a change in the price of Z.
Allow one to focus upon micro variables by ignoring macro variables.
Allow one to focus upon macro variables by ignoring micro variables.
Allow one to reason about the relationship between revenues and expenses of a business.
The real U.S. output increased by 2.5 percent last year.
Unemployment was 6.8 percent of the U.S. labor force last year.
The price of personal computers declined last year.
The general price level (inflation) increased by 4 percent last year.
Major topics of macroeconomics.
Not relevant to the U.S. economy
Major topics of microeconomics.
Peculiar to socialistic economies.
"sore loser syndrome" (loser doesn't want to see the end of the game when his team is losing.)
Adverse selection problem.
Fallacy of division.
Fallacy of composition.
The two graph as an upsloping line.
An increase in one variable is associated with a decrease in the other.
An increase in one variable is associated with an increase in the other.
The resulting relationship can be portrayed by a straight line parallel to the horizontal axis.
To establish a democratic political framework for the smooth operation of the government.
The establishment of prices that reflect the relative scarcities of products and resources.
Dealing with the scarcity of productive resources relative to an unlimited number of economic wants.
What do I do to get out of poverty?
A pair of stockings
A construction crane
A savings account
A share of IBM stock
How to profitably invest one's income in stocks and bonds.
How to use scarce productive resources efficiently.
How government policies affect businesses and labor.
Managing business enterprises for profit.
That resources are unlimited.
That people prefer one of the goods more than the other.
The maximum amounts of two goods that can be produced assuming the full and efficient use of available resources.
Combinations of labor only necessary to produce specific levels of output.
The monetary price of any productive resource.
The amount of labor that must be used to produce one unit of any product.
The ratio of the prices of imported goods to the prices of exported goods.
The amount of one product that must be given up to produce one more unit of another product.
The use of the least-cost method of production.
The production of the product-mix most wanted by society.
The full employment of all available resources.
Production at some point inside of the production possibilities curve.
Shows the relationship between price and quantity supplied.
Indicates the quantity demanded at each price in a series of prices.
Graphs as an upsloping line.
Shows the relationship between income and spending.
They are consumed independently.
An increase in the price of one will increase the demand for the other.
A decrease in the price of one will increase the demand for the other.
They are necessarily inferior goods.
A and B are substitute goods.
A is a normal good and B is an inferior good.
A is an inferior good and B is a normal good.
A and B are complementary goods.
Increase the demand for an inferior good.
Increase the demand for an inferior good.
Increase the demand for a normal good.
Decrease the supply of a normal good.
Reflects the amounts that producers will want to offer at each price in a series of prices.
Is reflected in a downsloping supply curve.
Was enacted by Congress to force businesses to produce goods that society wants.
Reflects the income and substitution effects of a price change.
Quantity supplied may exceed quantity demanded or vice versa.
There are no pressures on price to either rise or fall.
There are forces that cause price to rise.
There are forces that cause price to fall.
Supply and demand both decrease.
Supply increases and demand decreases.
The price of the salsa to go with them will go up.
Supply and demand both increase
"supply creates its own demand."
Fact that the U.S. tax system redistributes income from rich to poor.
Notion that, under competition, buying and selling decisions motivated by self-interest promote the social interest.
Tendency of monopolistic sellers to raise prices above competitive levels.
Hands of shoplifters caught "red-handed" by video cameras at stores such as Wal-Mart.
The number of sellers in a market.
The number of buyers in a market.
The extent to which the demand curve shifts as the result of a price decline.
The sensitivity of consumers to price changes.