Econ

Study guide for EXAM 1 in Principles of Microeconomics ECON 2106 – Reza Kheirandish

The best way to study for the test is to read the textbook first, then review using the PowerPoint slides and then do the assignments on the Sapling as well as the examples in the textbook. The following gives you only a list of material discussed in class. Use this list only as a guide to study the material for your upcoming exam.

Chapter 1

capital

circular flow diagram

command economy

division of labor

economics

economies of scale

exports

factors of production

fiscal policy

globalization

goods and services market

gross domestic product (GDP)

imports

input

labor

labor market

land

macroeconomics

market

market economy (a.k.a. free market economy)

microeconomics

model

monetary policy

private enterprise

resources

regulation

scarcity

specialization

theory

traditional economy

underground economy

Chapter 2

allocative efficiency

absolute advantage

budget constraint

choice

comparative advantage

growth (in PPF framework)

invisible hand

law of diminishing marginal utility

law of diminishing marginal returns

marginal analysis

normative statement

opportunity cost

opportunity set

out of pocket cost

positive statement

production possibilities frontier (PPF)

productive efficiency

properties of PPF

interpretation of slope of PPF (opportunity cost)

sunk costs

theory of comparative advantage

utility

Chapter 3

ceteris paribus

complements

consumer surplus

deadweight loss

demand

demand curve

demand schedule

economic surplus

equilibrium

equilibrium price

equilibrium quantity

excess demand (shortage)

excess supply (surplus)

factors of production (labor, land, and capital) a.k.a. inputs or resources

inferior good

inputs

law of demand

law of supply

normal good

price

price ceiling

binding (effective) price ceiling is set below the market equilibrium price

non-binding (ineffective) price ceiling is set above the...