Econ Unit Two test Review
The list of terms below is meant to guide your study. Please understand that there are things to study
“around” these words. I would suggest that you take the time to ensure that you are learning more than just
the basic definition so that you are prepared for the questions on the test!
Ex: If you’re looking at “Price Ceiling”…
 What is a price ceiling?
 Why would a government institute one?
 What is the desired effect on the economy?
 How would you show one on a graph?
Economic Models to know and manipulate:
Demand Graphs
Supply Graphs
Demand + Supply on the Same Graph
Terms/People/Ideas
Barrier to Entry
Compliments
Consumer Expectations
Consumer Income
Consumer Taste
Cost of Inputs
Demand
Disequilibrium
Elastic Supply/Demand
Equilibrium
Equilibrium Price
Excise Taxes
Fixed Cost
Future expectations
Government Subsidy
Income Effect
Increasing/Diminishing/Negative
Marginal Returns
Inelastic Supply/Demand
Inferior Goods
Law of Demand
Law of Supply
Marginal Cost
Marginal Product of Labor
Marginal Revenue
Market Clearing Price
Market Demand/Supply Schedule
MR=MC
Normal Goods
Number of Consumers
Number of Suppliers
Price Ceiling
Price Floor
Price System
Productivity/Motivation
Role of Prices
Shortage
Substitutes
Substitution Effect
Supply
Surplus
Technology
Total Cost
Total Revenue
Unit Elastic Supply/Demand
Variable Cost