EC 111 FINAL REVIEW .docx - MACRO FINAL EXAM OUTLINE The...

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MACRO FINAL EXAM OUTLINEThe following chapters and items WILL be on the final exam.Ch. 4Supply and Demand (KNOW EVERYTHING IN THIS CHAPTER)LOTS OF QUESTIONS1Def. and Concepts.Demand Schedule: a table that shows the relationship between the price of a good and thequantity demandedSupply Schedule: a table that shows the relationship between the price of a good and thequantity supplied2Difference between Demand and Quantity Demand (QD) and how they appear on a graph.
3How do you create a market demand curve?
4What is the Law of Demand?
5Difference between moving along a demand curve and shifting a demand curve.
6Difference between “Change in Demand” and “Change in Quantity Demanded”.
7What causes a movement along the demand curve?(Remember, if you move upward along ademand curve, that is a decrease in quantity demanded.If you move downward along ademand curve, that is an increase in quantity demanded.)PRICE!!!8What causes a shift of the demand curve?(Remember, if the demand curve shifts to the right,that is an increase in demand.If the demand curve shifts to the left, that is a decrease indemand.)
9What are the Determinants of Demand and how a change in them will shift the demand curve?
-Two goods are substitutes if an increase in the price of one good causes an increase in demandfor the other.-Two goods are complements if an increase in the price of one causes a fall in demand for theother.-Anything that cause a shift in tastes toward a good will increase demand for that good and shiftits D curve to the right.-Expectations affect consumers’ buying decisions10Normal vs. Inferior GoodNormal Good: positively related to income (increase in income will shift D curve to the right)Inferior Good: negatively related to income (increase in income will shift D curve to the left)11Substitutes vs. Complements

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Term
Spring
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