a public good that individuals can be excluded (physically prohibited) from consuming. Ex.: a college lecture: Only available to enrolled students of the college.

In a free enterprise a business will not produce a Non- Excludable Public Goods because they would not be paid for them.  

All private goods are Excludable

Three important Features of Free enterprise

·     

 Which is not one

Five Features of Free Enterprise

1.     Freedom of Choice

2.     Free to Compete (Competition)

3.     Voluntary Exchange

4.     Economic Incentive

5.     Private Property

What is Free Enterprise

A Car, a house, a piece of machinery ( A characteristic of Free Enterprise)

When sellers compete to get consumers to buy their products and or

Employers compete to get the best workers

( characteristic of Free Enterprise)

Where people earn income: Sell their labor: Centers on the four factors of production: Land, capital, labor and entrepreneur

Where people use income to buy from producers: Centers on goods and services: Businesses use money to produce more goods and services: Cycle repeats.

the amount of money left over after all the costs of production have been paid. Profit exists whenever total revenue is greater than total cost.

the amount of money by which total cost exceeds total revenue.

Total Revenue

Eminent Domain

5 Factors that cause Demand Curve to Shift

A CHANGE IN QUANTITY DEMANDED refers to a movement __________ a given demand curve

A "change in quantity demanded" refers to movement along a given demand curve and ONLY happens when there is a change in price

When the price goes up how does it effect the demand curve?

When price decreases

If a new tax is added to soda, how does that impact the demand curve

If the price of peanuts goes up, what happens to demand for its substitute ( ie. pretzels.

If the price of video games increases, what happens to demand for its compliment Gaming Consoles?

Elastic Demand Exists when

If elasticity is greater than 1, demand is Elastic

Perfectly Inelastic happens when there is _________ in the quantity of the product demanded when the ________ changes

The Law of Demand states as the price increases the quantity of goods decreases. This type of relationship is referred to as

Demand is both the Willingness and __________ of buyers to purchase a good or service

A change in PRICE is what causes quantity demanded to change

Demand is INELASTIC when the quantity demanded changes by a______ % than price

Demand is Elastic when the Quantity Demanded changes by a ________ % than price

The elasticity of Demand is affected by available substitutes

When the demand is _________, the percentage change in quantity demanded is the same as the percentage change in price

When Demand is ________, the percentage change in quantity demanded is less that the % change in price

Margarine and butter are substitute goods. What happens ti the demand of Margarine as the price of butter rises

What happens to the demand curve for apples if

More people begin to prefer Apples over oranges

What happens to the demand curve for apples if

peoples income rises ( and apples are a normal good)

When the price of apples rises 10% as the quantity demanded falls 20%

When the price of cars falls 5% and the quantity demanded rises by 10%

Does an increase in price necessarily bring about a higher total revenue

What does Ceteris Paribus mean?

Market Demand

What's the difference from Individual Demand

Individual demand implies, the quantity of good or service demanded by an individual household, at a given price and at a given period of time

·      Definition of law of supply

A law stating that as the price of a good increases, the quantity supplied of the good __________ and as such the price of a good decreases, the quantity supplied of the good ____________

refers to the willingness and ability of SELLERS to produce and sell different quantitates of a good at different prices. 

refers to the number of units of a good produced and offered for sale at a specific price

As the price rises the quantity supplied

A vertical supply curve is When the law of Supply does not hold true. A product that can’t be made anymore. The price can change but the quantity supplied won’t. If the movie is sold out, increase the price won’t allow you to sell more tickets. Is a Picasso painting a Vertical Curve?

A market supply curve is for the sum of all the individuals (firms) whereas the Individual if is for that particular individual firm.

Let’s assume there are only 2 drum makers. The Qs for the drum market is 300. If Pearl's Quantity Supplied in 200 what is the Quantity Supplied for ZuilJian

This kind of supply that exists when the % change in Qs is equal to the percentage change in price

is a numerical chart that illustrates the law of supply

 is a line that slopes upward from left to right and shows the amount of a good sellers are willing and able to sell at various prices

Factors affecting elasticity of supply – the relationship between the % change in Qs and % change in Price. When the numerator ( the top number) changes more than the price( denominator you have an

If the price of light bulbs increases by 10% and the Qs changes by 20% = the Supply of Light Bulbs is

If the price of Skate boards increases by 10% and the Qs changes by 5% = the Supply of Skateboards is

A legal limit on the number of units of a foreign produced good (import) that can enter the country

A new tax added to the production of drumsticks will cause

The government provides sellers with a subsidiary to aid in the production of vaccines. What impacts with this have

Factors impacting change in supply

Only Factor impacting Quantity Supplied

The law of supply says that Price and Qs move in the ___________ direction

The law of supply says that Price and Qs move in the same direction. This relationship is called a

Quantity Supplied refers to the _______ a good produced as offered to sell at various prices

A Market Supply curve represents the ______ of all individual Markets

Supply is Elastic when

When the supply curve moves left to right is there any impact to price?

If the price of the good decreases what happens to the Qs

If the price of a material used in drum-making increases what happens?

6 Factors that can change Supply

Cost of Inputs

Labor/Productivity

Technology

Government Action

Expectations

# of Sellers

How do the # of sellers affect the market?

If there are more sellers what would happen?

When the Quantity Supplied of a good is greater than the quantity Demanded

When the Quantity Demanded of a good is greater than the quantity Supplied

Impacts of Disequalibrium

Excess Demand occurs when there is a shortage and

Equilibrium is a point of balance between price and

Interactions between buys are sellers will always push the market

A price ceiling is a ( such as rent control)

Rent Control is not in Florida

Rent Control reduced the quantity and quality of housing

Rent Controls cause

Price Floors

Price floor example

If Minimum Wage is above the Market equilibrium it will result in a ____________ in Employment

If Minimum wage is below the equilibrium it will have _______ effect

A price ceiling on a graph is

A price floor on a graph is

A price floor creates a

If sellers have a shortage

Because it costs money to store inventory ... a seller will do what if they have a surplus

When two goods are Compliments the demand for one good moves in the ________ direction as the price of the other good

Market Size - The number of buyers

The more buyers the higher the demand

The fewer buyers the lower demand

Birth rate and immigration can impact this

Part of the Circular Flow of Economics includes what two Markets?

Name this Market: Where people earn income, sell their labor. Centers on Production - Land, Capital, Labor and Entrepreneurs

Name this Market - Where people income to BUY from Producers - centers of GOODS

Open Disclosure

Obey the Law

Being Truthful

Example of ?

Total Revenue > Total Cost

Which of the following is not something that makes a free enterprise more ethical

Profit and Losses not only serve as signals to the business but to those on the sidelines too

What is a solution for Free Riders?

The government can REDUCE the negative externalities through

Court System

Regulation

Taxation

Name this Market - Where people income to BUY from Producers - centers of GOODS

Part of the Circular Flow of Economics includes what two Markets?

What is GDP

How is GDP used?

It is COMPARED to what 3 things:

How is GDP calculated

The Expenditure Approach:

C= Consumption

I= Investment

G= Government Spend of Goods or Services

X = Total exports minus total imports, or net exports

Spending by Household or Consumption ( is represent end the GDP) as

Business Goods or Services is what in the GDP

Government Spending ( is represent end the GDP) as

X in the GDP represents

The Income Approach for calculating GDP

Adds up all the incomes in the country

What are the 2 approaches to calculating the GDP

All of the following are excluded from the GDP except

You purchase a new Ford F150 pickup truck for $40,000.

The government purchases $50 billion of new military equipment and weapons.

A consumer liquifies a mutual fund and purchases a used house.

Mexican consumers purchase $150 million worth of Apple iPads and iPhones

McDonalds builds 500 new restaurants throughout the United States.

American consumers purchase $15 billion of vegetables from Mexico.

Wawa opens up 70 new stores throughout Europe.

Costco restocks it inventories with $35 million worth of goods for summer.

Is the included or excluded in the GNP

When the GDP is adjusted for inflation

it is called

GDP when NOT adjusted for inflation is:

Four Phase of a Business Cycle

Expansion, Peak, Contraction, Through

High point where GDP stops growing, prices are at their highest and unemployment workers are hard to find.

What part of the business cycle is this?

What Business Cycle?

GDP is shrinking, consumers are not shopping, prices are falling and workers are losing jobs.

What Business Cycle?

Demand, production and unemployment are at their highest point

What Business Cycle?

In this cycle there is low unemployment and increases in prices

What Business Cycle?

The business cycle is followed by a downward recession

In this Business Cycle Inflation Pressure are rising

Why do prices tend to go up in Expansion?

What type of economic system is most likely to experience business cycles?

As the economy travels through a contraction, why does business investment tend to decline?

During Expansion= GDP going up, inflation.

During Contraction= Lower sales (less spending), unemployment goes up.

What is GDP

Business cycles are caused by the fluctuations in the economy in terms of:

How is GDP calculated

The Expenditure Approach:

C= Consumption

I= Investment

G= Government Spend of Goods or Services

X = Total exports minus total imports, or net exports