Microeconomics 1.1: The Market System Notes and Formulas

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What is the formula for calculating profit?

P = TR - TC (correct)

P = P * Q

TR = P * Q

P = Q - P

What does the percentage change formula measure?

Change in amount as a percentage of the new amount

Change in quantity demanded as a percentage of the price

Change in price as a percentage of the quantity demanded

Change in amount as a percentage of the original amount (correct)

How is total revenue calculated?

TR = TC - P

TR = Q - P

TR = P + Q

TR = P * Q (correct)

What are wants in economics?

Human desires that are unlimited or infinite (B) Signup and view all the answers

What does microeconomics focus on?

Individual agents within the economy (A) Signup and view all the answers

What is the formula for price elasticity of demand (PED)?

PED = PercentΔInQTY Demanded / PercentΔInPrice (A) Signup and view all the answers

What is the basic economic problem?

The unlimited wants and limited resources (B) Signup and view all the answers

Which of the following is considered a need?

Food (A) Signup and view all the answers

What are the four primary factors of production?

Land, labor, capital, enterprise (D) Signup and view all the answers

What is financial capital in the context of production?

The money invested into the business to produce physical capital (B) Signup and view all the answers

Why do businesses/individuals/governments have to make decisions on how to allocate resources?

Due to scarcity of resources and unlimited wants (B) Signup and view all the answers

What is human capital in the production process?

The human input into the production process (e.g., workers, managers) (D) Signup and view all the answers

What are some examples of natural resources included in the factor of land?

Water, air, minerals, soil (A) Signup and view all the answers

What does scarcity refer to in economics?

The limited availability of resources relative to unlimited wants (B) Signup and view all the answers

What does investment refer to in the context of production?

Increases in the level of capital (C) Signup and view all the answers

Why do countries have to decide on 'What to Produce'?

It is impossible to produce all the goods that people want (C) Signup and view all the answers

What is the formula for calculating profit?

P = TR - TC (B) Signup and view all the answers

What does the term 'scarcity' refer to in economics?

The limited nature of society's resources (C) Signup and view all the answers

What does the formula for percentage change measure?

Change in price (B) Signup and view all the answers

What is the formula for price elasticity of demand (PED)?

PED = P ercent Δ In QT Y Demanded/P ercent Δ In P rice (C) Signup and view all the answers

What does microeconomics focus on?

Individual agents within the economy (A) Signup and view all the answers

What are wants in economics?

Human desires that are unlimited or infinite (A) Signup and view all the answers

What is the basic economic problem?

Limited resources and unlimited wants (A) Signup and view all the answers

What are the primary factors of production?

Land, labor, capital, enterprise (C) Signup and view all the answers

What does investment refer to in the context of production?

Money invested into the business to produce physical capital (D) Signup and view all the answers

What is the role of enterprise in the production process?

Control and combine the other primary factors of production (D) Signup and view all the answers

Why do countries have to make decisions on 'What to Produce'?

To address the basic economic problem of scarcity (D) Signup and view all the answers

What does scarcity refer to in economics?

The gap between limited resources and unlimited wants (A) Signup and view all the answers

What are considered as needs in economics?

Food, shelter, water (A) Signup and view all the answers

'For Whom to Produce' in economics refers to:

Method of distribution among members of the population. (A) Signup and view all the answers

What comprises financial capital?

The money invested into the business. (C) Signup and view all the answers

Microeconomics 1.1: The Market System Notes and Formulas

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Questions and Answers

What is the formula for calculating profit?

What does the percentage change formula measure?

How is total revenue calculated?

What are wants in economics?

What does microeconomics focus on?

What is the formula for price elasticity of demand (PED)?

What is the basic economic problem?

Which of the following is considered a need?

What are the four primary factors of production?

What is financial capital in the context of production?

Why do businesses/individuals/governments have to make decisions on how to allocate resources?

What is human capital in the production process?

What are some examples of natural resources included in the factor of land?

What does scarcity refer to in economics?

What does investment refer to in the context of production?

Why do countries have to decide on 'What to Produce'?

What is the formula for calculating profit?

What does the term 'scarcity' refer to in economics?

What does the formula for percentage change measure?

What is the formula for price elasticity of demand (PED)?

What does microeconomics focus on?

What are wants in economics?

What is the basic economic problem?

What are the primary factors of production?

What does investment refer to in the context of production?

What is the role of enterprise in the production process?

Why do countries have to make decisions on 'What to Produce'?

What does scarcity refer to in economics?

What are considered as needs in economics?

'For Whom to Produce' in economics refers to:

What comprises financial capital?

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