Economics

1. According to the law of supply, what will happen to production as the price of a good goes higher? 2. What is the difference between supply and quantity supplied? 3. How does the quantity supplied of a good with a large elasticity of supply react to a price change? 4. What are production costs that do not change with the level of output? 5. How does the marginal product of labor change as more workers are hired? 6. What is the impact of diminishing marginal returns to labor? 7. Give an example of a fixed cost and a variable cost of a bakery. 8. How does a firm calculate marginal cost? 9. How does a subsidy affect supply? 10. How can regulation affect a producer’s output decisions?

1. What are the three characteristics of a demand curve? 2. What does it mean when the demand for a product is inelastic? 3. What is one good that can be considered a compliment for another? 4. What are two goods that can be considered substitutes? 5. What would happen to the demand curve for Metallica CDs if they become unpopular because people find out they don’t even play their own instruments? 6. What would happen to the revenue of a DVD rental store if the demand is highly elastic and the prices go up? 7. Name a good with elastic demand at its current price. 8. Why is demand for home heating fuels inelastic in cold weather? 9. How do we calculate total revenue? 10. What are the four factors that affect elasticity?

1. How does the government intervene to protect public health, safety and well-being? 2. What are the main programs through which the government redistributes income? 3. What are the differences between the public and private sectors? 4. What are some examples of “negative externalities”? 5. What are some examples of “positive externalities”? 6. Why are street lights an example of a public good? 7. How does calculating GDP help the government track the business cycle? 8. What are the phases of the business cycle? 9. What’s the difference between micro and macroeconomics? 10.What is the government’s role in encouraging innovation?