Supply and Demand
Markets and Models
What is a market?
A market is characterized by a specific:
1. Product or service being bought and sold
3. Point in time
Markets facilitate exchange, including economic resources and
final goods and se
The Basics of Production
Production describes the process by which an entity turns raw inputs
into a good or service.
Final goods are purchased by consumers (e.g., bread).
Intermediate goods are used as inputs in other production p
The Consumers Preferences and the
Concept of Utility
Economists assume consumers are rational and able to optimize
consumption decisions given scarce resources
Four assumptions about consumer preferences
Completeness and rankabi
Market Power and Monopoly
In the real world, there are very few examples of perfectly competitive
Firms often have market power, or an ability to influence the market price of a
The most extreme example is a monopoly,
Using Supply and Demand to Analyze
Consumer and Producer Surplus: Who
Benefits in a Market
Consumers benefit from market exchange, otherwise they would
Consumer surplus: the difference between the amount
consumers would be w
Supply in a Competitive Market
The previous chapters introduced the various costs that firms must contend
with when producing goods and services.
Firms minimize costs at every level of production.
But how do firms choose an optimal amoun
Costs That Matter for Decision
Making: Opportunity Costs
Costs are thought about differently in economics than in accounting.
Accounting costs include the direct costs of operating a business, including costs for
February 14, 2012
Midterm Examination 1 (Answer Key)
The questions begin from the back of this page. Dont turn this page until you are told to do so.
You have 75 minutes to complete the exam.
There are 3 questions (
February 17, 2011
Spring 2011 ECON 301
Midterm 1 Answer Key
There are (1) 6 multiple-choice questions, (2) 3 short answer questions, and (3) 2
questions with calculation. Show all your work instead of just putting down the answer. If
you are un
Spring 2017: ECON 301 Quiz 3 (Take-Home)
1. Suppose the utility function of U(x1,x2)=x10.5x20.5 and the budget constraint of
x1+2x2=40. (1) Find the optimal bundle of two goods (x1*, x2*). (2) If the
government imposes a quantity tax o
PRINCIPLES OF MACROECONOMICS
Chapter 3 Demand and Supply
PowerPoint Image Slideshow
Organic vegetables and fruits that are grown and sold within a specific geographical
region should, in theory, cost less than conventional produce because the
Four Categories of Goods
Most of what weve done so far is look at private goods. However, there are different
types of goods that we can consider and should be aware of whats happening
Rival one persons consuming a the good means no one else
The production function shows the relationship between the inputs employed by
a firm and the maximum output that can be produced with those inputs
Marginal Product of Labor: the additional output a firm produces after hirin
Demand and Supply
Last week, we talked about scarcity, tradeoffs, PPFs, and gains from trade
When we talked about the PPFs, we did not know where the individual was going
to end up along the PPF, just what was possible for him to produce
Now, we move on
Consumer and Producer Surplus
Consumer surplus the difference between the highest price a consumer is willing to
pay for a good or service and the price the consumer actually pays
Graphically, how do we express the consumer surplus?
Chapter 9 Utility
Utility the enjoyment that people receive from consuming goods or services
How happy does a given activity make me?
Higher number means higher levels of utility
Utility measures ordinal give rankings of what you like, but the ac
Arch, G. K. (1998, November 1). Marijuana smoking vs cannabinoids for glaucoma therapy.
Retrieved October 26, 2016, from https:/www.clinicalkey.com/#!/content/medline/2s2.0-9823341
The source proves that marijuana can be used
Activity 4: know your audience
1.) Through audience analysis the speaker can learn more about the audiences preferences
and reach them without problems. The speaker can Build their message tailored to the
audience and persuade them mor
1. Premise 1: Homes argues that little details are the most important details,
Premise 2: If Watson goes to boxing matches, then he gambles to.
Conclusion: Premise 1 was a deductive argument. The theory was little details are
2. It was the fear of electing a president with a low temperament misusing the launch codes
and causing a nuclear war.
3. The ad shows a la
Anselin, Luc, Attila Varga, and Zoltan Acs. "Local Geographic Spillovers between University
Research and High Technology Innovations." Journal of Urban Economics. 42.3 (1997):
Rough draft criteria
Protection: Is the mesh between the knuckles, and the support is mainly the strap or laces used
to secure the wrist in place. This prevents the wrist from bending during impact and causing
injury to hand, f
Best Boxing Gloves for Anyone
Every sports athlete wants to win and compete and at their highest level. Boxing is a
sport where becoming good takes a while, and commitment. If youre a beginner or pro
Beaver, L. (2015, September 11). Jeb Bushs cannabis confession and mom apology
ignites Internet fun. Retrieved October 11, 2016, from
January 22, 2017
3.1 Some Definitions
Suppose that given any two consumption bundles ( x1 , x2 ) and ( y1 , y2 ) .
If the consumer can rank these two bundles according to their desirab
February 7, 2017
6.1 Income Change and Demand
(1) Normal Goods and Inferior Goods
Suppose that a consumers income increases from m to m (m<m).
If the consumer increases the demand for a goo
Spring 2017: ECON 301 Quiz 1
Suppose a budget equation is given by p1x1+p2x2=m where p1=1, p2=2, and m=$100. The
government decides to impose a lump-sum tax of $20 and a tax on x1 by t=0.2
(p1*=p1+t=1.2). (1) Please draw the original budget lin
March 16, 2017
In the preceding classes, we have studied the behavior of a competitive industry. In the
competitive industry, there are a large number of small firms producing homogeneou
January 17, 2017
2. Budget Constraint
John plans to travel to Las Vegas. John stays at his favorite hotel for $70 per day. His total travel
budget is $700, which is divided into the hot