Microeconomics Notes PDF

1\. It focuses on the shift on equilibrium positions (statics) for an individual unit, a market, or an economic system. \- Comparative Statics 2\. It is a state in which there is a balance of internal forces and no tendency for thesituation to change unless outside forces intervene. It may also be...

1\. It focuses on the shift on equilibrium positions (statics) for an individual unit, a market, or an economic system. \- Comparative Statics 2\. It is a state in which there is a balance of internal forces and no tendency for thesituation to change unless outside forces intervene. It may also be termed as "static" \- Equilibrium 3\. It focuses on the pattern and rate of change for some variable between points time in time. \- Dynamic Analysis 4\. Compared to equilibrium this changes for one decision unit or one market independent of related changes in the economic system. It also assumes for the purpose of analysis, that other factors will remain the same. \- Partial Equilibrium Analysis 5\. Recognizes the independence of all decisions units and all the markets in the economic system. It also examines changes within the context of the entire system. \- General Equilibrium Analysis 6\. What is the basic consuming unit? \- Household 7\. What is the basic producing unit? \- Firm 8\. It also shows the flow of money and the flow of goods and services in both direction. \- Circular Flow 9\. Other term for financial flow? \- Money Flow 10\. It may be classified as traditional, command, or market systems. \- Economic Systems 11\. These are made according to customs and traditions. \- Traditional Economic Systems 12\. This system is socialistic as the government owns and controls the factors of production. It is also dictated by the nation or a group of men designated by the head to make the decisions. \- Command Economies 13\. Deals with the economic problems by considering consumer's choices. \- Market System 14\. The problem of production is solved by the \_\_\_\_\_ \- Price Mechanism 15\. It is an economy where individuals exercise free enterprise. \- Market Economy 16\. A place where buyers and sellers intearact and engage in exchange. \- Market 17\. Reflects a consumer's desire for a commodity. \- Demand 18\. The amount of a commodity available for sale. \- Supply 19\. The totality of a group consumer's demand. \- Aggregate Demand 20\. The totality of a group producer's demand. \- Aggregate Supply 21\. The quantities consumer are willing to buy of a good at various prices. \- Demand Schedule 22\. The quantities producers are willing to offer for sale at various prices. \- Supply Schedule 23\. A change from one point to another on the same curve. \- Movement along the curve 24\. A change in the entire curve caused by a change in the entire demand or supply schedule. \- Shift of the curve 25\. Also known as parameters, are factors other than price that also affect demandor supply. \- Nonprice Factors 26\. Shows how quantity demanded is dependent on its determinants. \- Demand Function 27\. Shows how quantity supplied is dependent on its determinants. \- Supplied Function 28\. Condition of balance or equality. \- Equilibrium 29\. An excess of supply over the demand for a good. \- Surplus 30\. It is the maximum limit at which the price of a commodity is set. \- Price Ceiling 31\. A minimum limit beyond which the price of a commodity is not allowed to fall \- Price Floor 32\. He combined the law of demand and the law of supply into one law. \- Alfred Marshall 33\. Combining the demand and supply curves will show the point of? \- Market Equilibrium 34\. The coefficient of price elasticity of demand between two points along the demand curve. \- Arc Elasticity 35\. It is the absolute value of elasticity. \- Coefficient of Elasticity 36\. Goods that supplement each other are used together. \- Complementary Goods 37\. It measures the percentage change in quantity demanded of one good compared with the percentage change in the price of a related good. \- Cross Elasticity of Demand 38\. The responsiveness of demand/supply to a change in its determinant. \- Elasticity 39\. A curve depicting the quantities of a good the consumer is willing to buy at all income levels, assuming all other things remain the same. \- Engel Curve 40\. Measures the percentage change in quantity demanded compared with the percentage change in income. \- Income Elasticity of Demand 41\. Goods which are bought when income levels are low, the demand for whichtends to decrease when income increases. \- Inferior Goods 42\. Goods for which demand tends to increase when income increases. \- Normal Goods 43\. The percentage change in quantity compared with a percentage change in price. \- Price Elasticity 44\. The coefficient of price elasticity of demand at one point along the demand curve \- Point Elasticity 45\. Goods bought for the status and prestige they give to the consumer and are bought when the prices are high. \- Prestige Goods 46\. Goods used in place of another. \- Substitute Goods 47\. The price of an item multiplied by the number of units of that itemsold. \- Total Revenue 48\. Price elasticity of demand has two measures: \- Arc Elasticity \- Point Elasticity