ECO 2030. Principles of Economics-Price Theory

Exam #1 Study Guide

The exam is worth 100 points.

Updated: 09/26/2008 02:12:25 PM

Key Terms:

• Chapter 1: scarcity, choice, opportunity cost, marginal decisions, rationality, incentives
• Chapter 2: models, product markets, factor markets, production possibilities frontier (PPF), efficient production, infeasible production, inefficient production, opportunity cost on the PPF, microeconomics, macroeconomics
• Chapter 3: absolute advantage, comparative advantage (and law of), specialization and trade,
• Chapter 4: markets, law of demand, factors that change demand (shift the curve), law of supply, factors that change supply (shift the curve), surplus, shortage, market equilibrium, changes in market equilibrium (due to changes in demand and supply)
• Chapter 13: profit, total revenue, total cost, explicit costs, implicit costs, economic profit, accounting profit, marginal product of labor, short run vs long run, variable cost, fixed cost, marginal cost

Problems:

• Page 59 problem #3 (a, b; assume Pat and Kris each have 12 hours in a day)
• Page 85 problem #1 (a, b, c), #3 (a, b, c, d)
• Page 86 problem #7 (a, b, c, d)
• Answer key
• Practice Test (chapter 3, 4 and 13 quantitative questions)

Answer Key: