Economic Theories and Figures Overview
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Questions and Answers

What is one tenth of annual produce or earnings, formerly taken as a tax for the support of the Church and clergy?

  • Ushr (correct)
  • Kharaj
  • Zakat
  • Jizyah

What is the function of advertising according to Veblen?

  • To inform consumers about products
  • To lower the price of products
  • To increase competition between firms
  • To create a desire for goods that display status and prestige (correct)

What significant theory did Edward H. Chamberlin contribute to economic thought?

  • The theory of supply and demand
  • The theory of perfect competition
  • The theory of monopolistic competition (correct)
  • The theory of comparative advantage

Where did Edward H. Chamberlin receive his education?

<p>Harvard, under Allyn A. Young (C)</p> Signup and view all the answers

With which schools of thought was Joan Robinson associated during her career?

<p>The Cambridge School and the Neo-Ricardian and Post Keynesian schools (D)</p> Signup and view all the answers

Which theory did Joan Robinson introduce to the field of economics?

<p>Imperfect competition (C)</p> Signup and view all the answers

Which economist is known for independently discovering a theory of imperfect competition?

<p>Edward Chamberlin (C)</p> Signup and view all the answers

What is considered the main work of John Maynard Keynes?

<p>The General Theory of Employment, Interest and Money (D)</p> Signup and view all the answers

Who is recognized as the founder of the Austrian School of Economics?

<p>Carl Menger (B)</p> Signup and view all the answers

What is the significance of the embodied theory in commodity production?

<p>It indicates the amount of labor (D)</p> Signup and view all the answers

Which economist published 'Elements of Pure Economics'?

<p>Leon Walras (B)</p> Signup and view all the answers

What was Friedrich von Wieser's primary contribution to economics?

<p>Opportunity cost and alternative cost (C)</p> Signup and view all the answers

Who argued for a connection between commercial crises and the solar cycle?

<p>William Stanley Jevons (C)</p> Signup and view all the answers

Which of the following terms is often used interchangeably with 'Austrian School'?

<p>Vienna School (C)</p> Signup and view all the answers

What defines a 'good' according to Carl Menger's ideas?

<p>A useful thing employed in the satisfaction of human needs (B)</p> Signup and view all the answers

Where and when was Friedrich von Wieser born?

<p>Vienna, 1851 (B)</p> Signup and view all the answers

What does the principle of effective demand in Keynesian theory primarily emphasize?

<p>The concept that aggregate demand equals aggregate supply (B)</p> Signup and view all the answers

How is effective demand expressed in an economy?

<p>By the aggregate expenditure of an economy (B)</p> Signup and view all the answers

What is the market for loanable funds primarily concerned with?

<p>A market for investable resources (D)</p> Signup and view all the answers

Which option correctly describes the term 'marginal propensity to consume'?

<p>The fraction of a change in income that is consumed (C)</p> Signup and view all the answers

Who is recognized as Friedrich A. von Hayek's major intellectual opponent?

<p>John Maynard Keynes (A)</p> Signup and view all the answers

In which school of thought was Friedrich A. von Hayek educated?

<p>Austrian economics (B)</p> Signup and view all the answers

What time period did Adam Smith live and work in?

<p>1723-1790 (D)</p> Signup and view all the answers

Which economist is associated with the German historical school?

<p>K. Marx (D)</p> Signup and view all the answers

Who prohibited French workmen from emigrating while inviting workmen from foreign countries?

<p>Jean-Baptiste Colbert (B)</p> Signup and view all the answers

Which economist sought to expel foreign merchants from France and support local merchants?

<p>Antoine de Montchrestien (A)</p> Signup and view all the answers

Which country’s importation was prohibited by William Stafford?

<p>Russia (A)</p> Signup and view all the answers

Which concept is attributed to John Law?

<p>Supply creates its own demand (C)</p> Signup and view all the answers

Which term refers to the school of thought in economics that began in the late 18th and early 19th centuries?

<p>Classical economics (A)</p> Signup and view all the answers

What is the main focus of Classical economics?

<p>Promoting economic growth through freedom and free competition (D)</p> Signup and view all the answers

What did classical economic theory promote for societal structure?

<p>Transition from monarch rule to capitalism and democracy (D)</p> Signup and view all the answers

What was Vilfredo Pareto's profession?

<p>An Italian economist (A)</p> Signup and view all the answers

Who believed that wages should cover the minimum living costs?

<p>John Stuart Mill (B)</p> Signup and view all the answers

What theory is Vilfredo Pareto known for developing?

<p>He developed general equilibrium theory (B)</p> Signup and view all the answers

What defines Pareto Efficiency?

<p>An economic state where resources cannot be reallocated to make one individual better off without making another individual worse off (A)</p> Signup and view all the answers

Which school of thought is Alfred Marshall associated with?

<p>Neoclassic (D)</p> Signup and view all the answers

What significant concept is Alfred Marshall known for introducing?

<p>Founding the 'Cambridge' school of Neoclassicism (B)</p> Signup and view all the answers

Which book by Alfred Marshall achieved notable success as a textbook?

<p>Principles of Economics (C)</p> Signup and view all the answers

When was 'Principles of Economics' by Alfred Marshall first published?

<p>July, 1890 (A)</p> Signup and view all the answers

What does the term 'Marshallian scissors' refer to?

<p>Demand and supply (D)</p> Signup and view all the answers

What is considered a potential threat to women's rights as human beings according to Fourier?

<p>Traditional marriage (C)</p> Signup and view all the answers

Who is known for the idea that demand drives supply in economic theory?

<p>Keynesian economists (D)</p> Signup and view all the answers

Which school of economic thought does the term 'utility' primarily belong to?

<p>Marginalism (A)</p> Signup and view all the answers

Which economist is attributed with the creation of the 'Economic Table'?

<p>Francois Quesnay (B)</p> Signup and view all the answers

What type of tax did the Physocrats consider essential for economic stability?

<p>Land tax (C)</p> Signup and view all the answers

According to Adam Smith, what constitutes the wealth of a nation?

<p>The size of its net product (C)</p> Signup and view all the answers

What was John Maynard Keynes's main belief regarding state intervention in the economy?

<p>Active intervention is necessary for economic stability (D)</p> Signup and view all the answers

According to W. Petty, what is considered the 'mother' of wealth?

<p>Land (C)</p> Signup and view all the answers

Flashcards

Pareto's contribution to economics

Developed the concept of Pareto Efficiency, a state where resource reallocation cannot improve one party's well-being without harming another.

Pareto Efficiency

A state where resources are allocated so no one can be better off without making someone else worse off.

Alfred Marshall's School

Neoclassical economics, emphasizing supply and demand forces that impact equilibrium.

Alfred Marshall's most successful textbook

Principles of Economics

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Marshallian scissors

The interaction between demand and supply that determines price.

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American Institutionalist economists

Economists like Thorstein Veblen, John Commons, and Wesley Mitchell who studied economic institutions and their impact on practices.

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Zakat

Islamic tax on wealth to support the poor and needy

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Jizyah

Islamic tax imposed on non-Muslims living in Muslim-governed territories

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Ushr (Tax)

A tax, formerly a tenth of the annual produce or earnings, historically supporting the church and clergy.

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Veblen's Advertising Function

Advertising creates a desire for goods, highlighting status and prestige, rather than simply informing consumers about products.

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Chamberlin's Contribution

Developed the theory of monopolistic competition, emphasizing product differentiation.

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Chamberlin's Education

Chamberlin studied economics at Harvard under Allyn A. Young.

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Keynes' Economic School

Associated with the Cambridge School, Neo- Ricardian, and Post Keynesian schools.

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Robinson's Theory

Introduced the theory of imperfect competition.

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Independent Discoverer of Imperfect Competition

Chamberlin independently discovered a similar theory of imperfect competition emphasizing product differentiation.

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Keynes' Book

The General Theory of Employment, Interest, and Money, a significant work in economics.

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Effective Demand (Keynesian)

Aggregate expenditure equals aggregate supply, driving economic activity.

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Market for Loanable Funds

Market where borrowing and lending of capital (money) occurs.

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Marginal Propensity to Consume

Fraction of income change spent on consumption.

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Friedrich Hayek's Rival

John Maynard Keynes

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Hayek's Economic Tradition

Classical, and specifically Austrian economics.

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Marx's Philosophical Inspiration

Bruno Bauer

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APP Full Form

Average period of production

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Neoclassical Economist at Columbia

John Bates Clark

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Austrian School founder

Carl Menger is the founder of the Austrian School of Economics.

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Positive theory of capital author

Eugen Böhm-Bawerk authored the 'Positive Theory of Capital'.

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"Elements of Pure Economics" author

Leon Walras wrote "Elements of Pure Economics".

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Embodied theory in commodity production

Embodied theory relates to the amount of labor in commodity production.

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Friedrich von Wieser's birth location/year

Friedrich von Wieser was born in Vienna in 1851.

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Wieser's main contributions

Wieser is known for contributions related to alternative cost/opportunity cost.

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Principles of Economics (1871) author

Carl Menger, who authored Principles of Economics.

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Definition of "good" (Menger)

A 'good' is a useful thing employed in satisfying human needs (according to Menger).

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Colbert's Economic Policy

Restricting foreign workers while promoting local merchants to control trade.

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Classical Economics

School of thought originating in 18th/19th century Britain; focused on free markets and competition.

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Invisible Hand

Unintended benefits to society from individuals pursuing self-interest.

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Classical Economics Focus

Economic growth through free markets and competition emphasizing laissez-faire principles.

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Living Wage

Wage level necessary to meet basic living expenses.

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William Stanley's Import Ban

Specific country's goods prohibited for import.

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Supply-Side Economics

Keynesian theory focusing on the idea that increasing production leads to more demand.

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John Locke's Economic Idea

A concept in economics related to avoiding chaotic and centralized management in an industry.

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Unemployment (B. Men, C.Women, D.Youngster)

Lack of jobs for those actively seeking work.

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What could potentially hurt women's rights?

Traditional marriage can hurt women's rights as human beings, according to Fourier.

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Demand drives supply?

Keynesian economics argues that demand drives supply and economies spend/invest more than they save.

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Evolution of economic views

F. Hayek, M. Friedman, and L. Erhard contributed to the evolution of modern economic theories (Neoliberalism & Monetarism).

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Erhard's contribution to German economy

Erhard led post-war economic reforms & recovery (often called "economic miracle").

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Founder of American economic School?

J.B. Clark is often considered a founder of the American economic School.

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Institutionalism school founder?

T. Veblen is generally credited as the founder of the Institutionalism School.

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"Utility" school

Marginalism is the school of thought associated with the concept of "utility".

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Study Notes

Economic Theories and Figures

  • Physiocrats: Identified three classes of the economy: productive, sterile, proprietor
  • Quesnay's "zig-zag" depiction: Depicts income flows between economic sectors; presented in an economic table
  • Islamic Finance Methods:
    • Mudarabah: Two parties pool resources, share profits/losses; one party provides capital, the other expertise
    • Musharaka: A form of financing that operates as a mutual fund; one party provides capital and the other party provides entrepreneurial skill
    • Murabaha: Financier acts as purchasing agent for borrower; goods are then sold to the borrower at a mark-up price
    • Ijara wa iktina: A financing method where the financier acts as a purchasing agent for the borrower, and then sells the goods to the borrower with a fixed mark-up on the purchase price

Comparative Advantage and Mercantilism

  • Comparative Advantage: Theory created by David Ricardo regarding international trade
  • French Mercantilism: Known as Colbertisme
  • German Mercantilism: Known as Cameralism

Economic Schools

  • Neoclassic: Investigated the "Dutch puzzle"
  • Mercantilism: A school of thought; characterized by government intervention in the economy
  • Austrian School of Economics: Founded by Carl Menger

Important Economists

  • Adam Smith: Lived from 1723-1790; known for the theory of Comparative Advantage
  • David Ricardo: Created the theory of comparative advantage, and also considered a key figure in classical economics
  • Alfred Marshall: Neoclassical economist; associated with the development of marginalism in economics
  • Joan Robinson: Economist associated with the Cambridge school, Neo-Ricardian and Post Keynesian schools; introduced imperfect competition to economics
  • John Maynard Keynes: Known for the General Theory of Employment, Interest, and Money, which significantly influenced modern macroeconomic theory
  • Edward Chamberlin: Developed a theory of monopolistic competition
  • Friedrich Hayek: Associated with the Austrian School of Economics
  • M. Friedman: Associated with Monetarism
  • Vilfredo Pareto: Known for his concept of Pareto Efficiency
  • W. Stafford: associated with Monetarism
  • W. Petty: One of the key thinkers that contributed to early economics, thought to have been one, if not the first, to have considered Labour as the source of wealth creation

Other Notable Concepts and Figures

  • Pareto Efficiency: An economic state where resources are efficiently utilized, and no one can be made better off without making someone else worse off
  • Marginal Propensity to Consume: The fraction of a change in income that is consumed.
  • Marshallian Scissors: Concept used to illustrate how demand and supply interact to determine price and quantity.
  • General Equilibrium Theory: Developed by Leon Walras
  • Economic Table: Created by F. Quesnay; depicts flow of income in an economy

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Description

Explore key concepts of economic theories including Physiocrats, Islamic finance methods, and David Ricardo's concept of comparative advantage. This quiz covers the foundational figures and terms that shape economic understanding. Test your knowledge of how these theories influence modern economics.

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