Scarcity correct answers Inefficiency or shortness of the supply
Opportunity cost correct answers Cost of the next best alternative
Factors of production correct answers Factors of Production
•Capital (physical & human)
•Entrepreneurship
•Land
•Labor.
Marginal utility correct a...
Economics paper 1(with Errorless answers)
Scarcity correct answers Inefficiency or shortness of the supply
Opportunity cost correct answers Cost of the next best alternative
Factors of production correct answers Factors of Production
•Capital (physical & human)
•Entrepreneurship
•Land
•Labor.
Marginal utility correct answers the additional benefit/satisfaction resulting from the consumption of one
more unit of a good
Demand correct answers How much of a product or service is desired by a consumer
Unemployment rate correct answers % of those in the labor force who are unemployed
Labor force correct answers those who are willing and able to be employed
Underemployment correct answers - Workers who accept jobs for which they are over-qualified, or work
fewer hours than they would prefer (they are not counted as unemployed)
The law of demand correct answers •A decrease in the price of good X will result in an increase in the
quantity demanded for good X, ceteris paribus.
•An increase in the price of good X will result in a decrease the quantity demanded for good X, ceteris
paribus.
Supply correct answers Represents how much the market can offer
, The law of supply correct answers •An increase in the price of good X will result in an increase in the
quantity supplied of good X, ceteris paribus
•A decrease in the price of good X will result in a decrease in the quantity supplied of good X, ceteris
paribus
Equilibrium correct answers Intersection of supply and demand
Allocative efficiency correct answers Output level with the price equals The marginal cost of production
Price ceiling correct answers Maximum price that can be charged
Price floor correct answers Minimum price that can be charged
Shortage correct answers The demand for a product or service exceeds the supply
Price elasticity of demand correct answers •The responsiveness of the quantity demanded of a good to a
change in the price of the good
Cross price elasticity of demand correct answers •The responsiveness of the quantity demanded of a good
to a change in the price of a different good
Income elasticity of demand correct answers •Responsiveness of quantity demanded, at a constant price,
to changes in income
Price elasticity of supply correct answers •The responsiveness of the quantity supplied of a good to a
change in the price of that good
Specific tax correct answers Per-unit tax
Ad valorem tax correct answers Tax on percentage of the purchase price
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