Economics Final Exam Study Guide - Mr Parker



Economics Final Exam Study Guide

You will be allowed to use notes, assignments, tests and quizzes

Vocabulary to Know (you may use this as a word bank for the test):

Microeconomics

Macroeconomics

labor

land

capital

supply

demand

equilibrium

Scarcity

Cost

Benefit

Capitalism

Market

Market economy

Free Enterprise system

Command economy

Socialism

Entrepreneur

Negative externality

Shirking

Opportunity costs

Subsidy

Quota

Shortage

Surplus

Sole proprietorship

Partnership

Corporation

Bond

Stock

monopolistic

ologopolistic

perfectly compteitive

Money

Barter

Gross Domestic Product

Inflation

Recession

Expansion

Deficit

Debt

Introduction to Economics:

Specify the difference between macroeconomics and microeconomics.

Identify the basic economic questions that all societies must answer.

Why do people need to make choices?

Identify the functions of Money.

Identify the types.

Describe how the three basic economic questions are answered in traditional, command, and market economies.

What must a consumer do in order to make an economic decision?

Describe the concept of opportunity costs of making decisions.

Supply and Demand

Explain what the law of demand states?

What factors can shift demand for a product?

What does it mean if a demand curve shifts to the left or to the right?

Explain what the law of supply states?

What factors can shift a supply curve? Identify if those factors will shift the curve left or right.

Identify the determinants of supply.

Explain how shifts in demand and supply affect market equilibrium.

Identify where a surplus and shortage exists on a graph.

Market Structure and Business Organizations

How are profit and loss calculated?

How do consumers benefit from competitive markets?

What are the conditions of perfect competition, oligopolistic markets, and monopolistic markets?

Describe the advantages and disadvantages of sole proprietorships, partnerships, and corporations.

Elements of Macroeconomics

What are the differences between a free enterprise system (capitalism/market economy) and a command economy (socialism)?

What GDP and real GDP?

What is the business cycle?

What are recession and inflation and when do they occur in the business cycle?

The Federal Reserve, Fiscal and Monetary Policy, and Taxes

Know the goals of contractionary and expantionary fiscal and monetary policies, when they would be used, and how are they achieved.

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