Econ Final

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Megazostradon
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21106
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Econ Final
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2010-06-02 01:35:16
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Econ Final
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Answers and questions to help you pass the econ final.
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  1. Demand and Market demand Schedule:

    Supply and Market Supply Schedule:
  2. Demand
    • Price QD
    • $0.50 5
    • $1.00 4
    • $1.50 3
    • $2.00 2
  3. Show effect of elasticity and relationship to total revenue:
    • Elastic Demand:
    • As the price is lowered...total revenue rises.
    • As the price is raised ...total revenue falls


    • Inelastic Demand:
    • As the price is lowered...Total revenue falls
    • As the price is raised...total revenue rises.
  4. 3 factors of production:
    Land, labor, and capital.
  5. 2 types of capital:
    Human and Physical
  6. How do resources and technology relate?
    Improvements in technology allow an economy to produce more output from the same or smaller quantity of inputs, or resources.
  7. 2 advantages of Free Market:
    • Efficient
    • Freedom
  8. 4 problems of a command economy:
    • Poor quality of goods
    • no incentive
    • Lack of choices
  9. List the basics of free enterprise
  10. Whats the 3 roll's of the government in free market?
    • 1. employment
    • 2. Growth
    • 3. Stability
  11. 3 outcomes policy makers try to reach in economy
  12. what is technology progress in economy and how is it important?
  13. what are 4 types of cash transfers?
    • 1. social security
    • 2 TAMF
  14. what are 2 types of in-kind benefits?
    • 1. Food Stamps
    • 2. Cash-AID
  15. What are 2 types of health insurance provided by the US and what are the differences?
    • 1. Medicare - used for the elderly
    • 2. Madicade - used for low income person
  16. State the Law of Demand
    Consumers buy more of a good when its price decreases and Less of a good when the price increases.
  17. Causes of the demand curve:
    Shifts:
  18. 2 factors that effect elasticity:
  19. Was the first bank successful in bringing order?
    no, it didn't last long
  20. 1 issue that was caused by free banking:
  21. 2 issues in banking during the depression:
    1. You couldn't pay back loans
  22. What was one thing that Roosevelt did when he reformed the banks?
    Bank holiday
  23. what are 2 functions of financial institutions?
    • 1. Issue loans
    • 2. Store money
  24. what are 2 types of financial institutions?
    • 1. Commercial banks
    • 2. Savings Banks
  25. what are 4 categories of final goods and services for the expenditure aproach?
  26. what are 2 things not acounted for GDP?
  27. What are 4 phases of the business cycle?
  28. what are the levels of severity during a contraction?
    recession, depression, stagflation
  29. what are 2 examples of financial intermediaries?
    • 1. Banks
    • 2. Credit Unions
  30. What are 3 components of Bonds?
    • 1. coupon rate
    • 2. par value
    • 3. maturity
  31. what are 5 types of bonds?
    1.
  32. why was buying stocks on margin an issue?
  33. what is the danger of speculation?
  34. what is inflation? and its effect on purchasing power?
    people on fixed incomes are more effected by it.
  35. what are 2 limits on power to tax?
    • 1. you can't tax exports
    • 2. you can't tax in between states
  36. what are 2 characteristics of good tax?
    • 1. symplicity
    • 2. fairness
  37. what are 4 causes of poverty?
    • 1. lack of education
    • 2. lack of skill
    • 3. cultural or racial backgrounds
    • 4. change in household
  38. what are the 3 causes of inflation?
    • 1. demand pool
    • 2. cost push
    • 3. raise spiral
  39. What is price healing and price floor?
    graph rent control:
    list the positive and negative things
  40. Graph minimum wage:
  41. how can you tell if minimum wage is above or below equalibrium?
    if its above then there are more workers.
  42. what are 3 advantages of price?
    • 1. free
    • 2. price incentive
    • 3. flexible
  43. what is the black market?
    its were goods are bought and sold illegaly
  44. what is the law of supply? and what are 2 things combined to make it?
    • Law of supply is the tendency of suppliers to offer more of a good at a hire price.
    • relationship between elasticity and time
  45. what is fixed cost and veriable cost?
    • fixed cost: doesn't change
    • veriable cost: goes up or down
  46. what is the effect on input cost on supply?
  47. what are 3 government influences on supply?
    • 1. subsidies
    • 2. taxes
    • 3. regulations
  48. what is the level of price control for perfect competition?
    there is no price control
  49. what are 4 conditions of perfect competetion?
    • 1. many buyers and sellers participate in the market
    • 2. sellers offer identical products
    • 3. buyers and sellers are well informed about products
    • 4. sellers are able to enter and exit the market freely
  50. what are 2 examples of bariers to entry?
    • 1. start up costs
    • 2. technology
  51. what is a monopoly?
    when all the markets are owned and controlled by one person
  52. what is an oligopoly?
    when the market is controlled by a few large firms
  53. what are 3 conditions that have to be in place for price descrimination to work?
    • 1. some market power
    • 2. distinct customer groups
    • 3. difficult resale
  54. what are 2 conditions of monopolistic competition?
    • 1. many firms
    • 2. few artificial barriers to entry
  55. what are 2 forms of non-price competition?
    • 1. physical characteristics
    • 2. location
  56. what are 3 practices of ologopolies that concern government?
    • 1. predator pricing
    • 2. bariers to entry
    • 3. collusion
  57. what are cartels?
    they are a form of organization of producers that agree to coordinate prices and production.
  58. what are 2 industries that were deregulated in the 70's and 80's?
    the airline industry and banking industry
  59. what are the 4 types of unemployment?
    • frictional unemployment
    • seasonal unemployment
    • structural unemployment
    • cyclical unemployment
  60. what are 2 examples of mandatory spending?
    • 1. social security
    • 2. medicare
  61. what are 2 descresionary spendings?
    • 1. education
    • 2. scientific research
  62. what are 2 types of budgets that states have?
    • 1. operating budgets
    • 2. capital budgets
  63. what are 3 limits of fiscal policies?
    • 1. difficulty of changing speding levels
    • 2. predicting the future
    • 3. delayed results
  64. what are 2 examples of automatic stabilizers?
    • 1. taxes
    • 2. transfer
  65. what role did the government have in economy in Keyne's view?
    their role was spending
  66. what happened with government spending with Regan, Bush and Clinton?
    their spending went up
  67. what tax cuts did Kennedy propose? did it work?
  68. what did the laffner curve do?
    shows that increasing tax rates beyond a certain point makes it harder to raise further tax revinue.
  69. what were WWII ideas?
  70. why is creating money an issue?
    because it leads to extremely high inflation
  71. Who is national debt owned by?
    • 1.foreign investers
    • 2. US investers
  72. what is the difference between deficits and debts?
    debt is a total of all deficits
  73. what are 3 limits of fiscal policy?
    • 1. delayed results
    • 2. consensus
    • 3. predicting the future
  74. what are 3 sectors of keynesian theory?
  75. show the change in CD market:
  76. what are 3 advantages of a sole proprietorship?
    • 1. ease of start up
    • 2. full control
    • 3. sole receiver of profit
  77. what are 3 disadvantages of a sole proprietorship?
    • 1. completely liable
    • 2. not much resources
    • 3. lack of permanence
  78. what are 2 advantages of a partnership?
    • 1. ease of start up
    • 2. shared decision making/ specialization
  79. what are 2 disadvantages of a partnership?
    • 1. unlimited liability
    • 2. potential for conflict
  80. what are 2 advantages of incorporation?
    • 1. Low liability due to cooporate veil
    • 2. transferable info
  81. what are 2 disadvantages of incorporation?
    • 1. expensive start up
    • 2. requirements and regulations
  82. what are 3 advantages of franchizes?
    • 1. built in reputation
    • 2. standardized quality
    • 3. good managment and training
  83. what are 3 types of mergers?
    • 1. vertical
    • 2. horizontal
    • 3. conglomerates
  84. what are 3 disadvantages of franchises?
    • 1. expensive to start up
    • 2. strict guidelines
    • 3. limited product line
  85. what are 3 main catagories of cooperative consumers?
    • 1. personal
    • 2. service cooperative
  86. what are 3 requirements for someone to be employed?
    • 1. they would have had to work atleast one hour pay in the last week
    • 2. worked 15 or more hours without pay in a family business or farm
    • 3. held jobs but did not work due to illness, labor disputes or bad weather.
  87. what is a full time student employed?
    unemployed
  88. what is the shift of US economy from manufaturing to the service industry?
    • our prodution of services is increasing faster than our production of goods.
    • ex: financial services, online services, healthcare and desktop publishing.
  89. what are 5 examples of the shift in the labor force in the 1960's?
    30% of women were in the work force, in 2010 there are 62.2%
  90. what are 2 benefits to temp employees?
    • 1. easier to fire
    • 2. usually paid less
  91. what happened to the cost of workers?
    the cost of benefits went up
  92. what are 4 catagories of skill levels?
    • 1. unskilled
    • 2. semi skilled
    • 3. skilled
    • 4. professional
  93. what are 2 factors that effect the number of jobs people are willing to do?
    1.
  94. what are 4 elements of collective bargaining?
    • 1. wages and benefits
    • 2. working conditions
    • 3. job security
    • 4.
  95. what is the difference between mediation and arbitration?
    Mediation- is when a neutral mediator meets at both sides to find a solution.

    Arbitration- is when a 3rd party reviews the cass and imposes a decision when legaly binding for both sides.
  96. what are 3 uses of money?
    • 1. medium of exchange
    • 2. unit of account
    • 3. store value
  97. what are 3 characteristics of money?
    • 1. durability
    • 2. portability
    • 3. exceptability
  98. What are the 3 sources of money's value?
    • 1.Commodity money
    • 2. representative money
    • 3. fiat money
  99. What are the 2 views on banking?
    • 1. The federalists who were lead by Jefferson supported the central banking system.
    • 2. the anti-federalists who were lead by Hamilton and they supported the state banking system.

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