Microeconomics Exam 2 – SBU Wright

This type of resource consists of the skills and knowledge of workers.

The change in total output that results from the employment of one additional unit of a resource.

This consists of human-made resources, like tools, machines, and buildings that are used to produce other things.

This effect explains why a highly-paid worker may not increase her supply of labor if her wage rate rises from $1,000/hour to $3,000/hour.

Mike is easily able to change careers and is also able to move from one state to another with very little cost. Mike's this, the ease with which factors of production are able to move among alternative uses, is very high.

This ancient Greek philosopher had an early statement of the power of incentives when he wrote "if you want to encourage something, reward it. If you want to discourage it, punish it."

Russian Communism was based on the writings of this man, particularly his Communist Manifesto.

These two individuals selling of land, as described in Acts 5, presupposes the existence of private property rights.

This effort, once led by Bono, has the goal of reducing global poverty through increases in foreign aid to developing countries.

Under this man's ruthless leadership, over 2 million people died as a result of a communist experiment in Cambodia in the 1970s.

Father of economics, whose 1776 treatise The Wealth of Nations described the market as an invisible hand that guides the acts of individuals to promote an end which is no part of their intention.

This atheist writer, a famous champion of capitalism, missed some of the subtleties of capitalism by focusing on human greed according to MGG.

According to Winston Churchill, the inherent vice of capitalism is the unequal sharing of these and the inherent virtue of socialism is the equal sharing of these.

Contrasting capitalism with an unrealizable ideal rather than its live alternatives leads to this myth according to MGG.

Author of the essay I, Pencil.

An action of unionized employees to discontinue working for their employer and to take steps to prevent other potential workers from offering their services to the employer.

Unionization among this group of workers has increased significantly in recent years, up to 35.9%.

A law that prohibits the requirement that employees must join a union as a condition of employment.

Sum of the union wage premium in 1984 and the union wage premium in 2012.

Name three of the five factors discussed in class that have contributed to a decline in union membership among U.S. workers.

An elasticity of demand with an absolute value higher than this number is considered to be elastic.

Goods that take up a very large percentage of a consumer's budget will tend to have this type of price elasticity of demand.

This is calculated by taking the percentage change in quantity demanded and dividing it by the percentage change in income.

This type of good, such as bus fare or spam, has a negative income elasticity.

The two primary determinants of price elasticity or inelasticity of demand as discussed in class.

These costs do not vary with output.

The key differentiation between accounting costs and economic costs is the fact that accounting costs exclude these associated with using the firm's equity capital.

Many large firms have lower per unit costs than small firms due to the development of these, the usage of large plants to produce a large volume of output.

Once this is reached, it will take successively larger amounts of the variable factor to expand output by one unit. In other words, marginal costs will increase as output expands.

If a company doubles the size of its plant and other associated inputs, yet the output level does not double, the company is experiencing this economic phenomenon characterized by higher average total costs at a higher level of output.

A business owned by a single individual who is fully liable for its debts.

The myth that every trade requires a winner and a loser.

The idea than an action should be undertaken if and only if the benefits exceed the costs is known as this concept.

These type of problems occur in corporations when the top-level executives lack the profit incentives that the stockholder owners of the corporation have.

If Seth leaves his $36,000/year teaching position and invests $10,000 of his savings (which was earning 5% interest) to start a personal training business in which his net income after expenses in Year 1 equals $40,000, his economic profit is equal to this.