AP Microeconomics CRAM

question

Vertical Axis

answer

The vertical number line of a graph along which values of the y-variable are measured. y-axis, price.

question

Horizontal Axis

answer

X-axis, quantity horizontal.

question

Slope

answer

Rate of change in y in response to a change in x.

question

Positive Slope

answer

Increase in value (direct relationship) (supply curve).

question

Negative Slope

answer

Decrease in value (inverse relationship) (demand curve).

question

Economics

answer

Is an attempt to overcome scarcity, trade-offs, and opportunity costs.

question

Scarcity

answer

Insufficient resources to satisfy unlimited wants.

question

Opportunity Cost

answer

True cost of something including what is given up to get it; "value lost".

question

Factors of Production

answer

1. Land=naturally occurring resource.
2. Labor=human effort in production process.
3.Capital=value of all assets; including money, equipment, buildings, tools, and inventory.

question

Entrepreneurship

answer

Risk taking by individuals and business firms.

question

Property Rights

answer

System in which valuable items have specific owners who can dispose of them as they choose.

question

Role of incentives

answer

Possibility of personal gain; what motivates people to be involved in the market system and is a major contributor of efficiency in the market economy.

question

Law of Diminishing Marginal Returns

answer

When increasing amounts of a variable factor of production are employed in a production along with a fixed fixed production factor, after some point the amount produced will diminish.

question

Opportunity Cost example

answer

Take a nap and lose out on watching t.v.; The t.v. time is the opportunity cost.

question

4 Factors of Production

answer

1. Land=water, trees, minerals
2. Labor=workers
3.Entrepreneurship=take risks needed to start and maintain a business
4.Capital=financial capital is the money needed to pay for venture, physical capital for buildings and equpment.

question

Role of Incentives

answer

Motivates people to be involved with a market system, ex) spending more time studying certain test material, since my incentive for extra hours of study is a good grade, (Hourly vs. Commission Employees)-incentive to try harder or develop more skill.

question

Production Possibilities Curve (PPC)

answer

Graphical representation of the combination of 2 goods and/or services that can be produced by an economy when using resources efficiently, can shift ONLY because of factors of production or trade.

question

Countries that produce capital goods

answer

Have more growth since capital is a resource.

question

Production Possibilities Frontier (PPF)
*AP exam

answer

Graphical representation of the combination of 2 goods and/or services that can be produced by an economy when using resources efficiently.

question

Trade-off

answer

The act of giving up one thing to have more of another.

question

Economic Growth

answer

Changes in total output of a nation overtime as a result of increased production, income, and wealth.

question

Inefficiency

answer

The waste that stems from unproductive use of resources, ex) unemployment.

1 of 22

question

Vertical Axis

answer

The vertical number line of a graph along which values of the y-variable are measured. y-axis, price.

question

Horizontal Axis

answer

X-axis, quantity horizontal.

question

Slope

answer

Rate of change in y in response to a change in x.

question

Positive Slope

answer

Increase in value (direct relationship) (supply curve).

question

Negative Slope

answer

Decrease in value (inverse relationship) (demand curve).

question

Economics

answer

Is an attempt to overcome scarcity, trade-offs, and opportunity costs.

question

Scarcity

answer

Insufficient resources to satisfy unlimited wants.

question

Opportunity Cost

answer

True cost of something including what is given up to get it; "value lost".

question

Factors of Production

answer

1. Land=naturally occurring resource.
2. Labor=human effort in production process.
3.Capital=value of all assets; including money, equipment, buildings, tools, and inventory.

question

Entrepreneurship

answer

Risk taking by individuals and business firms.

question

Property Rights

answer

System in which valuable items have specific owners who can dispose of them as they choose.

question

Role of incentives

answer

Possibility of personal gain; what motivates people to be involved in the market system and is a major contributor of efficiency in the market economy.

question

Law of Diminishing Marginal Returns

answer

When increasing amounts of a variable factor of production are employed in a production along with a fixed fixed production factor, after some point the amount produced will diminish.

question

Opportunity Cost example

answer

Take a nap and lose out on watching t.v.; The t.v. time is the opportunity cost.

question

4 Factors of Production

answer

question

Role of Incentives

answer

question

Production Possibilities Curve (PPC)

answer

Graphical representation of the combination of 2 goods and/or services that can be produced by an economy when using resources efficiently, can shift ONLY because of factors of production or trade.

question

Countries that produce capital goods

answer

Have more growth since capital is a resource.

question

Production Possibilities Frontier (PPF)
*AP exam

answer

Graphical representation of the combination of 2 goods and/or services that can be produced by an economy when using resources efficiently.

question

Trade-off

answer

The act of giving up one thing to have more of another.

question

Economic Growth

answer

Changes in total output of a nation overtime as a result of increased production, income, and wealth.

question

Inefficiency

answer

The waste that stems from unproductive use of resources, ex) unemployment.

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AP Microeconomics CRAM

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