Economics Final Exam Review
You are welcome to come in before or after school to access previous exams for study purposes.
In order to earn 5 extra credit points on your Midterm Exam and have the opportunity of using a
4*6 notecard during the exam, you must complete the review in full. Extra credit will be offered
on an all or nothing basis and will be due the day of your final.
1. Define each of the following terms. Each of the following terms could either be presented on your final
exam in matching format or as a multiple choice question. Know examples and understand each concept
fully (Don’t just look up book definition; won’t be enough for most of them.)
a.
b.
c.
d.
e.
f.
g.
h.
i.
j.
k.
l.
m.
n.
o.
p.
q.
r.
s.
t.
u.
v.
w.
x.
y.
z.
aa.
bb.
cc.
dd.
Goods and Services
Paradox of Value
The Factors of Production (Land, Labor, Capital, and Entrepreneurship)
Division of Labor
Economics
Economic Systems (Free Market, Command, Mixed, and Traditional)
Productivity
Inflation
Private Property Rights
Profit Motive
Consumer Sovereignty
Utility
Competition
Economic Growth
Voluntary Exchange
Capitalism
Inferior vs. Normal goods
Supply and Demand
Theory of production
Law of Variable Proportions
Marginal Revenue
Variable Cost
Subsidy
Total Product
Production Function
Profit-Maximizing Quantity of Output
Total Cost
E-Commerce
Supply and Demand Equilibrium
Shortages and Surpluses on the Supply and Demand graph
2.
3.
4.
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8.
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21.
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23.
ee. Price Ceilings and Price Floors on the Supply and Demand graph
ff. Externalities (Positive and Negative)
gg. Resource Immobility
hh. Public vs. Private goods
ii. Public Disclosure
jj. Economies of Scale
kk. Collusion
ll. Market Failure
mm.
Price Discrimination
nn. Specialization
oo. Absolute and Comparative Advantage
pp. Infant Industries
qq. Foreign Exchange Rates
Why is the study of economics so important?
What does “there is no such thing as a free lunch” mean?
What is the purpose of the government in all types of economic systems?
Who controls the products being produced in a Free market economy?
Go back to your Business Organizations table and study the Advantages and Disadvantages of
Sole Proprietorships, Partnerships, and Corporations.
Understand the Law of supply and the Law of Demand.
What factor is the overlying factor that dictates Elasticity of Supply?
What two factors does the theory of production deal with?
Understand the graphs for the Supply and Demand: Shortages, Surpluses, Price Floors, and Price
Ceilings.
Why will the government interfere in the market economy by setting prices with price floors and
price ceilings?
Know and understand the characteristics of Market Structures: Perfect Competition,
Monopolistic competition, Oligopoly, and Monopoly.
Why are monopolies such rare occurrence in the free market system?
What are the most common forms of market failures? What results from each?
Why are externalities considered a market failure?
Know the different types of Monopolies.
What is the purpose of government regulation?
What are the characteristics of money?
What were the problems of currencies issued by the state banks?
What is the gold standard? Why was it abandoned? What were its advantages and
disadvantages?
What are all the functions of money?
What are the arguments for free trade vs the arguments for protectionist?
Know and understand the different types of unemployment.