study guide Microeconomics 1111
U of M
Popular in microeconomics
Popular in Economcs
This 2 page Study Guide was uploaded by Heather Herzig on Saturday September 26, 2015. The Study Guide belongs to Microeconomics 1111 at University of Minnesota taught by Satis Devkota in Fall 2015. Since its upload, it has received 102 views. For similar materials see microeconomics in Economcs at University of Minnesota.
Reviews for study guide
If you want to pass this class, use these notes. Period. I for sure will!
-Mrs. Lulu Johnson
Report this Material
What is Karma?
Karma is the currency of StudySoup.
You can buy or earn more Karma at anytime and redeem it for class notes, study guides, flashcards, and more!
Date Created: 09/26/15
Micro econ 1111 study guide the limited nature of society s resources the study of how society manages its scarce resources eg when society gets the most from its scarce resources when prosperity is distributed uniformly among society s members of any item is whatever must be given up to obtain it incremental adjustments to an existing plan Something that induces a person to act ie the prospect of a reward or punishment a group of buyers and sellers need not be in a single location allocates resources through the decentralized decisions of many households and rms as they interact in markets when the market fails to allocate society s resources efficiently when the production or consumption of a good affects bystanderse g pollution Market power a single buyer or seller has substantial in uence on market price e g monopoly the dispassionate development and testing of theories about how the world works Assumptions simplify the compleX world make it easier to understand a highly simplified representation of a more complicated reality Economists use models to study economic issues a visual model of the economy shows how dollars ow through markets among households and firms the resources the economy uses to produce goods amp services including labor land capital buildings amp machines used in production is a graph that shows the combinations of two goods the economy can possibly produce given the available resources and the available technology is one with many buyers and sellers each has a negligible effect on price of any good is the amount of the good that buyers are willing and able to purchase the claim that the quantity demanded of a good falls when the price of the good rises other things equal a table that shows the relationship between the price of a good and the quantity demanded of any good is the amount that sellers are willing and able to sell the claim that the quantity supplied of a good rises when the price of the good rises other things equal A table that shows the relationship between the price of a good and the quantity supplied P has reached the level where quantity supplied equals quantity demanded a shift in the S curve occurs when a nonprice determinant of supply changes like technology or costs a movement along a xed S curve occurs when P changes Change in demand a shift in the D curve occurs when a nonprice determinant of demand changes like income or number of buyers movement along a xed D curve occurs when P changes is a numerical measure of the responsiveness of Qd to one of its determinants Principle 1 People Face Tradeoffs Principle 2 The Cost of Something Is What You Give Up to Get It Principle 3 Rational People Think at the Margin Principle 4 People Respond to Incentives Principle 5 Trade Can Make Everyone Better Off Principle 6 Markets Are Usually A Good Way to Organize Economic Activity Principle 7 Governments Can Sometimes Improve Market Outcomes Economists have 2 roles Scientists try to eXplain the world Policy advisors try to improve it Two markets the market for goods services the market for factors of production
Are you sure you want to buy this material for
You're already Subscribed!
Looks like you've already subscribed to StudySoup, you won't need to purchase another subscription to get this material. To access this material simply click 'View Full Document'