1. Define scarcity.
2. Factors of Production (Inputs or Resources)
Factor
Definition
Examples
Factor Payment
C
P
H
E
L
L
3. What role do property rights and efficiency have on factors of production?
4. Define marginal analysis.
5. Is thinking about how much benefit you would receive from buying another pair of boots a use of marginal
analysis? Explain
6. Define a consumer.
7. Define a producer.
8. Define an investor.
9. Define a saver.
10. Draw a production possibilities graph and include the following points using their letter on your graph?
a. Trade Offs (a to b)
b. Opportunity Cost
c. Efficient
d. Inefficient
e. Unattainability
f. Growth
11. Define an opportunity cost.
12. How does an opportunity cost differ from a trade off?
13. How does the invisible hand affect a pure/free market (include self-interest and competition)?
14. What role/s does the government play in a mixed economy?
15. Differentiate the characteristics of market and command systems.
16. Define competition
17. Define consumer sovereignty
18. Define government regulation
19. Define profit motive
20. Identify the characteristics of a mixed-market economy including such concepts as private ownership,
profit motive, consumer sovereignty, competition, and government regulation role of private property
in conserving scarce resources and providing incentives in a market economy.
21. Define public good
22. Define private good
23. How does profit motive affect a firm’s decision-making?
24. Define Law of Demand.
25. Define Law of Supply.
26. Define ceteris paribus.
27. How does the concept of ceteris paribus affect the supply and demand graph?
28. Draw a correctly labeled demand graph.
29. On the graph above show how quantity demanded changes as price changes using an arrow labeled QD1.
30. On the graph above show an increase in demand using an arrow labeled D2
31. Draw a correctly labeled supply and demand graph.
32. On the graph above draw a price ceiling labeled PC.
33. On the graph above draw a price floor labeled PF.
34. What impact does an effective price ceiling have on the market?
35. What impact does an effective price floor have on the market?
36. How is supply and demand affected by what is happening in the news?
37. What is a supply and demand schedule?
Use the table below to answer the following questions.
Supply and Demand schedule for pizza slices
Price
Quantity Demanded
Quantity Supplied
$0.50
5
1
$1.00
4
2
$1.50
3
3
$2.00
2
4
$2.50
1
5
38. What is the equilibrium (market clearing) price? ____________
39. What would occur in the market if the price was set $1.00? _______________
40. What would occur in the market if the price was set at $2.00? _____________
41. Draw a circular flow model.
42. What do households sell to firms? _________ ___ ____________________
43. What do firms sell to households? __________ ______ __________________
44. Define the factor market and who buys and sells in this market.
45. Define the product market and who buys and sells in this market.
46. Define voluntary exchange.
47. How does the circular flow model express the interdependence of households, firms and the government?
48. Why does the U.S. enforcement of the rule of law and contracts ensure economic development?
49. The four types of market structures.
Market Structures
Characteristics of
the Market
# of Sellers
Barriers to Entry
Type of Product
Efficiency Level
Control over Price
Perfectly Competitive
Monopolistically
Competitive
Oligopoly
Monopoly
50. Define natural monopoly.
51. What is a vertical merger?
52. What is a horizontal merger?
53. Short Run Costs
Fixed Costs
Variable Cost
Definition
Examples- Check which cost
Factory
Raw Materials
Workers
Machines
54. What is the golden rule of profit maximization?
55. At what point does a firm decide to shutdown/go out of business?
56. Complete the tax table.
Tax
Progressive Tax
Regressive Tax
Proportional/Flat Tax
Definition
Example of a tax
57. What is the difference between average tax rate and marginal tax rate?
58. What is a FICA tax?
Who does it affect negatively?
59. Complete the Deflation/Inflation Table.
Definition
Deflation
Inflation
Hyperinflation
What causes it to occur?
Effect on Purchasing Power
60. What is the difference between a tax and a subsidy?
61. Draw the business cycle and label the five phases.
62. What is the function of the Commerce Department?
63. What is the function of the Bureau of Labor Statistics?
64. Describe Demand-Side (Keynesian) Economics.
65. Describe Supply-Side Economics.
66. Define borrower.
67. Define lender.
68. Define fixed income.
69. Define cost of living.
70. What is a COLA and what impact does it have on purchasing power?
Who is negatively affected?
71. The Consumer Price Index measures ______________
72. Define unemployment
73. Define Gross Domestic Product.
74. What are the characteristics of the labor force?
Age _____
____________ a job or _____________ a job.
Non-Institutionalized: _____________, ________________, _________________, _____________________
75. What is considered full employment?
76. Complete the types of unemployment table.
Types of
Definition
Unemployment
What caused you to lose your
job?
Frictional
Structural
Cyclical
Seasonal
77. What is underemployment?
78. How is the economy impacted by high unemployment?
79. How does high unemployment affect wages and the ability to negotiate wage increases?
80. What is the relationship between unemployment, inflation and economic growth?
81. Who determines U.S. fiscal policy?
82. What are the two tools of fiscal policy?
a.
b.
83. How does expansionary fiscal policy affect inflation and unemployment?
Natural or unnatural
unemployment
84. Define crowding out.
85. What is the Federal Reserve System (FED)?
86. What are the FED’s main functions?
87. How does the FED use Monetary Policy to affect the economy?
88. What role does the Federal Open Market Committee (FOMC) play at the FED?
89. What are three functions of money?
a.
b.
c.
90. What are the six characteristics of money?
a.
b.
c.
d.
e.
f.
91. Define Fiat money.
92. What is included in the M1 and M2 parts of the money supply?
M1
1.
1.
2.
2.
3.
3.
4.
4.
93. What is Monetary Policy?
94. What are the 3 tools of Monetary Policy?
a.
b.
c.
M2
95. Differentiate between Expansionary and Contractionary Monetary Policy and their impact on the money supply.
Contractionary Policy
Expansionary Policy
Required Reserves
Discount Rate
Treasury Securities/Open Market Operations
96. Define standard of living.
97. How does business investment of new machinery and factories affect the future standard of living?
98. Define specialization
99. Define trade.
100. Define trade barriers
a. Define trade quotas.
b. Define tariffs.
101. Define protectionism.
102. Assess the effects of protectionism on a nation’s standard of living.
103. Define developed and developing countries
104. Identify NAFTA
105. Differentiate between saving and spending.
106. Differentiate between short-term and long-term investing.
107. Distinguish between a want and need.
108. Predict the growth of an investment using the Rule of 72 – 9% ____ , 4% ____ , 12% ____ , 9 years ____
109. Define return.
110. Define liquidity.
111. Determine the relationship between risk and return.
112. Determine the relationship between liquidity and risk/return.
113. Differentiate between short and long -term investment vehicles.
114. Differentiate between saving and investing.
115. Explain the role of the FDIC.
116. Define stock.
117. Define bond.
118. Define diversification.
119. Define portfolio.
120. Define mutual fund.
121. Define maturity.
122. Define yield.
123. Differentiate between preferred and common stock.
124. Compare and contrast stocks, bonds, and mutual funds.
125. Define bear and bull market.
126. Differentiate the different types of bonds (treasury, municipal, corporate and savings).
Treasury Bonds
Savings Bond
Municipal Bonds
Who sells them?
Purpose
Tax Benefits?
Risk Level
Corporate Bonds
127. Assess the importance of bond ratings in relationship to risk and return.
128. How do the costs of investing (broker fees, commissions, taxes, service fees, inflation) affect an investment’s
return?