Podcast
Questions and Answers
A firm is defined as an organization that employs factors of production to produce a good or service that it hopes to ______________ sell
A firm is defined as an organization that employs factors of production to produce a good or service that it hopes to ______________ sell
profitably
The two types of production costs are explicit (accounting) costs and ______________ costs
The two types of production costs are explicit (accounting) costs and ______________ costs
implicit
Accounting profit is total revenue - ______________ costs
Accounting profit is total revenue - ______________ costs
explicit
Economic profit is total revenue - explicit costs - ______________ costs
Economic profit is total revenue - explicit costs - ______________ costs
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In perfect competition, firms face ______ demand curves at the market's equilibrium price.
In perfect competition, firms face ______ demand curves at the market's equilibrium price.
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The short run is the time over which at least one production input is ______________ and can't respond to a shift in demand
The short run is the time over which at least one production input is ______________ and can't respond to a shift in demand
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Fixed inputs cannot be changed in the short run, whereas ______________ inputs can
Fixed inputs cannot be changed in the short run, whereas ______________ inputs can
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In perfect competition, individual firms are too small to change anything about the ______.
In perfect competition, individual firms are too small to change anything about the ______.
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The marginal product of labor (MPL) is the change in TPL resulting from a change in ______________ input
The marginal product of labor (MPL) is the change in TPL resulting from a change in ______________ input
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The Method of 'Totals' is used to maximize ______ profit.
The Method of 'Totals' is used to maximize ______ profit.
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In perfect competition, P = ______ = AR.
In perfect competition, P = ______ = AR.
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The law of diminishing marginal returns states that as more of a variable resource is allocated to production, the marginal product ______________
The law of diminishing marginal returns states that as more of a variable resource is allocated to production, the marginal product ______________
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The factor (P - ______) represents profit-per-unit.
The factor (P - ______) represents profit-per-unit.
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Average total cost (ATC) is total cost divided by ______________
Average total cost (ATC) is total cost divided by ______________
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If TR < ______, firms stop production and suffer losses equal to TFC.
If TR < ______, firms stop production and suffer losses equal to TFC.
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Economies of scale are advantages of greater scales of production and happen where LRAC is ______________
Economies of scale are advantages of greater scales of production and happen where LRAC is ______________
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In a ______ industry, entry/exit has no effect on cost curves.
In a ______ industry, entry/exit has no effect on cost curves.
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A ______ monopoly arises where ATC for large firms >> ATC for small ones.
A ______ monopoly arises where ATC for large firms >> ATC for small ones.
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Monopolies operate on the upper half (elastic half) of the ______ curve.
Monopolies operate on the upper half (elastic half) of the ______ curve.
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Allocative ______ has the most net benefit to society.
Allocative ______ has the most net benefit to society.
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The law of ______________ states that, holding all else equal, there is an inverse (negative) relationship between the price and the quantity demanded of a good.
The law of ______________ states that, holding all else equal, there is an inverse (negative) relationship between the price and the quantity demanded of a good.
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Nominal (absolute, money) prices are meaningless because they are ______________ (i.e. $3/gal gas now isn't necessarily more expensive than $1/gal gas fifty years ago)
Nominal (absolute, money) prices are meaningless because they are ______________ (i.e. $3/gal gas now isn't necessarily more expensive than $1/gal gas fifty years ago)
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The ______________ effect is the change in quantity demanded of one good that results in the change in another good's relative price.
The ______________ effect is the change in quantity demanded of one good that results in the change in another good's relative price.
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A demand ______________ is a table that summarizes a good's quantity demanded at certain prices.
A demand ______________ is a table that summarizes a good's quantity demanded at certain prices.
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The law of supply states that, holding all else equal, there is a direct (positive) relationship between the price and the quantity ______________ of a good.
The law of supply states that, holding all else equal, there is a direct (positive) relationship between the price and the quantity ______________ of a good.
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The determinants of demand influence the willingness and ability of the consumer to purchase units of a good or ______________.
The determinants of demand influence the willingness and ability of the consumer to purchase units of a good or ______________.
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A market is in ______________ if QS = QD.
A market is in ______________ if QS = QD.
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Consumer surplus occurs when consumers pay for less than they'd be willing to, this is the area above equilibrium and below the ______________ curve.
Consumer surplus occurs when consumers pay for less than they'd be willing to, this is the area above equilibrium and below the ______________ curve.
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Producer surplus occurs when producers receive enough to cover the MC, and then some, this is the area below equilibrium and above the ______________ curve.
Producer surplus occurs when producers receive enough to cover the MC, and then some, this is the area below equilibrium and above the ______________ curve.
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At equilibrium, total ______________ is maximized.
At equilibrium, total ______________ is maximized.
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The lowest 20% of the population has ______% of the wealth.
The lowest 20% of the population has ______% of the wealth.
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Income distributions can also be displayed graphically with a ______ curve.
Income distributions can also be displayed graphically with a ______ curve.
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The Gini ratio = A / (A + ______) = above / (above + ______).
The Gini ratio = A / (A + ______) = above / (above + ______).
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In the United States, income is redistributed through ______.
In the United States, income is redistributed through ______.
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A progressive tax exists if, as income increases, the average ______ rates increase.
A progressive tax exists if, as income increases, the average ______ rates increase.
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A regressive tax exists if, as income increases, the average ______ rates decrease.
A regressive tax exists if, as income increases, the average ______ rates decrease.
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Collusive pricing involves ______ between direct competitors.
Collusive pricing involves ______ between direct competitors.
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Cartels are groups of firms that formally agree not to compete with each ______.
Cartels are groups of firms that formally agree not to compete with each ______.
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In a competitive labor market, firms can employ as much labor as they want at the market ______.
In a competitive labor market, firms can employ as much labor as they want at the market ______.
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The marginal revenue product of labor is a measure of what the next unit of labor brings to the ______.
The marginal revenue product of labor is a measure of what the next unit of labor brings to the ______.
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In a perfectly competitive labor market, MRPL equals MRC equals ______.
In a perfectly competitive labor market, MRPL equals MRC equals ______.
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The law of demand applies seamlessly to ______ markets.
The law of demand applies seamlessly to ______ markets.
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The demand for an input is derived from the demand for the good produced by that ______.
The demand for an input is derived from the demand for the good produced by that ______.
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An increase in the demand for lemonade will also lead to an increase in demand for workers who produce ______.
An increase in the demand for lemonade will also lead to an increase in demand for workers who produce ______.
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The higher a resource's quality, the more ______ it is, generally.
The higher a resource's quality, the more ______ it is, generally.
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If the effect of substitution effect is greater than the output effect, labor demand will ______.
If the effect of substitution effect is greater than the output effect, labor demand will ______.
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