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ECO%20210%20Test%201,%20Study%20Guide,%20030 - The concept...

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ECO 210 Test 1 Study Guide TERMS - There will be 20 terms from the list of terms below on the test in matching format. The definitions will come from the textbook glossary Normal Good Economics Opportunity Costs Households Inferior Good Production Possibilities Frontier Factors of Production Law of Demand Price Rationing Law of Supply Substitutes Complementary Good Equilibrium Price Ceiling Black Market Laizze-Faire Economy Positive Economics Normative Economics Macroeconomics Microeconomics Excess supply or surplus Excess demand or shortage Three Basic Questions Theory of Comparative Advantage Marginalism Consumer Sovereignty MULTIPLE CHOICE TOPICS - There will be 30 multiple choice questions which will address the topics below: - The concept of scarcity - The difference between laissez-faire (market), command and mixed economies - The definition of economics - The reasons for studying economics - The difference between normative and positive economics
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Unformatted text preview: - The concept of opportunity costs - The difference between a positive and a negative relationship - The concepts of absolute and comparative advantage - The operation of a production possibilities frontier - The operation of supply and demand curve to include the difference between changes in demand or supply and changes in quantity demanded or quantity supplied - The concept of market equilibrium - The difference between normal goods and inferior goods and their effect on the market - The other determinants of demand - The other determinants of supply - The difference between substitutes and complements and their effect on markets - Meaning of price ceiling, price floor and Black Market - The function of the price system in rationing goods and allocating resources - The operation of the circular flow diagram - Marginal costs - Theory of Comparative Advantage...
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