A

Abatement,

See Pollution - abatement

Agricultural market,

See Price support - agriculture

Demand & Supply - Equilibrium - 6

Perfect Competition - Introduction - 3-5

Current Events - Drug Bust

Air pollution,

See Pollution - air

All else being equal,

See Ceteris paribus

Allocative efficiency. See also Optimal provision

Factor Markets - Market Power - 2, 10

Public Economics - Introduction - 2

Public Economics - Optimal Provision - 1

Externalities - Industry Structure - 1-6

Externalities - Pollution Taxes - 3-5

Antitrust law,

Elasticity - Revenue - 9

Monopoly - Introduction - 4,5

Oligopoly - Repeated Games - 5, 10

Arc elasticity,

See Elasticity - arc

Asia,

Current Events - Asian Crisis

Average fixed cost (AFC)

• computation of,
  Production Costs - Cost Computation - 2

  shown graphically,

  Production Costs - Cost Areas - 3

  curve,

  Production Costs - Cost Curves - 1

Average fixed costs (AFC),

Production Costs - Mutiple Choice Questions - 12

Average product (AP)

• computation of,
  Production Costs- Marginal Product - 1

  curve,

  Production Costs- Marginal Product - 2

  and marginal product,

  Production Costs- Marginal Product - 2

Average revenue (AR)

• computation of,
  Perfect Competition - Firm Demand - 3
  Perfect Competition - Mutiple Choice Questions - 14

  curve,

  Perfect Competition - Firm Demand - 3

Average total cost (ATC)

Production Costs - Mutiple Choice Questions - 4,12,14,17

• computation of,
  Production Costs - Cost Computation - 2

  shown graphically,

  Production Costs - Cost Areas - 2

  curve,

  Production Costs - Cost Curves - 7

  long-run average total cost,

  See Long-run average cost (LRAC)

  minimized (minimum of ATC),

  Production Costs - Cost Shifts - 2

  Perfect Competition - Demand Change - 7, 11

Average variable cost (AVC)

Production Costs - Mutiple Choice Questions - 3,4,7,17

• computation of,
  Production Costs - Cost Computation - 2

  shown graphically,

  Production Costs - Cost Areas - 1

  curve,

  Production Costs - Cost Curves - 5

B

Backward bending labor supply curve,

See Supply of labor curve - backward bending

Barriers to entry

• definition of,
  Perfect Competition - Introduction - 6

  for a monopolist,

  Monopoly - Introduction - 3

  Monopoly - Demand Change - 1

  Monopoly - Profit Maximization - 16

  Monopoly - Entry Barriers - 1-17

  for a monopolistic competitor,

  Monopolistic Competition - Entry Barriers - 1-9

  Monopolistic Competition - Mutiple Choice Questions - 7,11

  for an oligopolist,

  Oligopoly - Introduction - 2

  for a perfect competitor,

  Perfect Competition - Introduction - 6

  Perfect Competition - Equilibrium - 3

  Perfect Competition - Cost Change - 10

  See also Patents

Benefit-cost analysis,

See Cost-benefit analysis

Bonds,

Demand & Supply - Expectations - 2

Monopolistic Competition - Entry Barriers - 4

Budget constraint

• definition of,
  Consumer Choice - Introduction - 1

  examples of,

  Consumer Choice - Budget Constraints - 1-5

  Consumer Choice - Utility Maximization - 1-5

Budget line,

See Budget constraint

C

Capacity, excess

See Excess capacity

Capital,

See Factors of production - capital

Capital investment,

See Investment

Cartel,

Current Events - Energy Use

Ceteris paribus (all else being equal)

• definition of,
  Demand & Supply - Law of Demand - 1

  examples of,

  Demand & Supply - Law of Supply - 4

  Consumer Choice - Tax/Surplus - 6

  Externalities - Industry Structure - 6

Change in demand,

See Demand - change in demand

Change in quantity demanded,

See Quantity demanded - change in

Change in supply,

See Supply - change in supply

Change in quantity supplied,

See Quantity supplied - change in

Collusion,

Oligopoly - Mutiple Choice Questions - 7,13

Current Events - Productivity

• definition of,
  Oligopoly - Repeated Games - 2

  and game theory,

  Oligopoly - Repeated Games - 2-16

  and monopsonies,

  Factor Markets - Market Power - 5

  tacit collusion,

  Oligopoly - Repeated Games - 3

Competition,

See Imperfect competition

See Perfect competition

See Monopolistic competition

Competitive behavior,

See Perfect competition

Competitive markets,

See Perfect competition

Complementary goods (complements)

• definition of,
  Demand & Supply - Substitutes & Complements - 4

  and demand,

  Demand & Supply - Law of Demand - 2

  Demand & Supply - Substitutes & Complements - 4-6

  Demand & Supply - Mutiple Choice Questions - 3

  Perfect Competition - Demand Change- 2

  Public Goods - Optimal Provision - 2

  Factor Markets - Factor Prices - 4

  and elasticity (cross-price),

  Elasticity - Demand - Cross Price - 1-9

  Elasticity - Mutiple Choice Questions - 2,17

Constant returns to scale (CRS),

Production Costs - Long Run Costs - 7

Consumer behavior,

Factor Markets - Firm Hiring - 5

See also Consumer choice

See also Consumers' surplus

Consumer choice,

Consumer Choice - Introduction - 1

Current Events - Microsoft and DOJ

Consumers' surplus

• definition of,
  Consumer Choice - Consumers' Surplus - 2

  and excise tax,

  Consumer Choice - Tax-Surplus - 1-8

  shown graphically,

  Consumer Choice - Consumers' Surplus - 2-4

Consumption,

Consumer Choice - Introduction - 1

• of petroleum products,
  Current Events - Energy Use

Consumption bundle,

Consumer Choice - Preferences - 2

Cost (s)

• definition of,
  Introduction - Opportunity Costs - 2

  external costs,

  See Externalities

  fixed costs,

  See Fixed Costs

  forgone costs,

  Perfect Competition - Short Run - 6

  indirect costs,

  Introduction - Cost & Profit - 1

  Introduction - Opportunity Costs - 2

  long-run costs,

  See Long-run costs

  marginal cost,

  See Marginal cost

  opportunity cost,

  See Opportunity cost

  production costs,

  See Production Costs

  short-run costs,

  See Short-run costs

  social costs,

  See Social costs

  total costs,

  See Total Costs

  variable costs,

  See Variable costs

Cost-benefit analysis,

Externalities - Introduction - 1

Crime,

• and collusion
  Current Events - Productivity

  and prisoners' dilemma

  Oligopoly - Dilemmas - 3

Cross (price) elasticity of demand,

See Elasticity - cross price elasticity of demand

D

Deadweight loss,

Consumer Choice - Tax-Surplus - 6-8

Decision making, economic

Introduction - Micro - 4,5

Introduction - Cost & Profit - 4,6

See also Intangible aspect

Decreasing returns to scale (DRS),

Production Costs - Long Run Costs - 5, 6, 9

Perfect Competition - Long Run Supply - 7

Demand. See also Demand curve

• change in demand,
  Demand & Supply - Law of Demand - 3-4

  and complements,

  Demand & Supply - Substitutes & Complements - 4-6

  curve,

  See Demand curve

  definition of,

  Demand & Supply - Demand Introduction - 1

  desired quantity demanded,

  Demand & Supply - Demand Introduction - 1

  derived demand,

  See Factors of Production - Derived Demand

  demand equation,

  Demand & Supply - Schedule & Equations - 4

  Demand & Supply - Mutiple Choice Questions - 5

  elastic demand,

  See Elastic demand

  expectations,

  Demand & Supply - Law of Demand - 2

  Demand & Supply - Demand Expectations - 1

  Current Events - Oil Price Increases

  factor demand,

  See Factor demand

  industry demand,

  Perfect Competition - Firm Supply - 3

  inelastic demand,

  See Inelastic demand

  inverse relationship,

  Demand & Supply - Demand Introduction - 2

  Demand & Supply - Law of Demand - 2

  market demand,

  Production Costs - Long Run Costs - 9

  Perfect Competition - Firm Supply - 3

  Perfect Competition - Equilibrium - 5

  Monopoly - Profit Maximization - 1, 4, 5

  Factor Markets - Market Power - 1

  Public Goods - Demand for Public Goods - 1

  shift in demand,

  Demand & Supply - Law of Demand - 3-4

  and substitutes,

  Demand & Supply - Substitutes & Complements - 1-3

  and taxes,

  Consumer Choice - Tax-Surplus - 7

  Current Events - Cigarette Tax

Demand curve. See also Demand

• downward sloping,
  Demand & Supply - Demand Introduction - 3

  factor demand curve,

  See Factor demand curve

  graph of,

  Demand & Supply - Demand Introduction - 2

  kinked demand curve,

  Oligopoly - Kinked Demand - 2-5

  Oligopoly - Mutiple Choice Questions - 14,15

  movement along,

  Current Events - Drug Bust

Demand elasticity,

See Elastic demand

See Inelastic demand

See Price elasticity of demand

Demand schedule,

Demand & Supply - Schedule & Equations - 1

Demand and supply

• analysis,
  Demand & Supply - Schedule & Equations - 1
  Demand & Supply - Mutiple Choice Questions - 16

  equations,

  Demand & Supply - Schedule & Equations - 1

  schedule,

  Demand & Supply - Schedule & Equations - 3

Derived demand,

See Factors of Production - Derived Demand

Desired quantity demanded,

See Quantity demanded

Desired quantity supplied,

See Quantity supplied

Differentiated products,

Monopolistic Competition - Introduction - 1

Industry Policy - Industry-Efficiency - 1

Diminishing rate of technical substitution,

Factor Markets - Firm Hiring - 10

Diminishing returns,

See Law of diminishing returns

Diseconomies of scale,

See Decreasing returns to scale (DRS)

Dominant strategy,

See Game theory - dominant strategy

Dominated strategy,

See Game theory - dominated strategies

E

Economic cost. See Opportunity cost

• definition of,
  Introduction - Cost & Profit - 1

Economic loss

• definition of,
  Introduction - Cost & Profit - 4
  Perfect Competition - Short Run - 10

Economic rents

• definition of,
  Factor Markets - Economic Rents - 1

  example of,

  Factor Markets - Economic Rents - 3-4

Economic profit

• definition of,
  Introduction - Cost & Profit - 2

  example of,

  Introduction - Cost & Profit - 3-5

  Introduction - Mutiple Choice Questions - 1,2

  Monopolistic Competition - Mutiple Choice Questions - 1,5

  Factor Markets - Mutiple Choice Questions - 22

  and elasticity,

  Elasticity - Own Price - Revenue - 4

  shown graphically,

  Perfect Competition - Short Run - 6

  and property tax,

  Perfect Competition - Mutiple Choice Questions - 27

Economies, market

See Market economies

Economies of scale,

See Increasing returns to scale (IRS)

Efficiency,

See Allocative efficiency

Elastic demand. See also Price elasticity of demand

• definition of,
  Elasticity - Demand - Own Price - 1

  infinitely (perfectly),

  Elasticity - Demand - Own Price - 24

  Perfect Competition - Firm Demand - 1-2

  types of,

  Elasticity - Introduction - 4

Elasticity

• arc elasticity,
  • definition of,
    Elasticity - Introduction - 10-11

    arc cross price elasticity,

    Elasticity - Demand - Cross Price - 5

    arc income elasticity,

    Elasticity - Demand - Income - 14

    arc own price elasticity,

    Elasticity - Demand - Own Price - 16
• cross price elasticity of demand,
  • definition of,
    Elasticity - Introduction - 4
    Elasticity - Demand - Cross Price - 1

    example of,

    Elasticity - Mutiple Choice Questions - 2,3,10,17
• definition of,
  Elasticity - Introduction - 1

  demand,

  See Elastic demand

  See Inelastic demand

  perfectly inelastic, shown graphically

  Elasticity - Demand - Own Price - 23

  perfectly elastic, shown graphically

  Elasticity - Demand - Own Price - 24

  along a demand curve shown graphically,

  Elasticity - Demand - Own Price - 17

  income elasticity of demand,

  • definition of,
    Elasticity - Introduction - 4

    example of,

    Elasticity - Demand - Income - 1

    Elasticity - Mutiple Choice Questions - 1,4,7,12,13,14,18

  inelastic demand,

  own price elasticity of demand,

  See Price elasticity of demand

  price elasticity of demand,

  See Price elasticity of demand

  own price elasticity of supply,

  • definition of,
    Elasticity - Introduction - 4

    sign of,

    Elasticity - Supply - 1

  point elasticity,

  Elasticity - Introduction - 12

Employment,

Introduction - Mutiple Choice Questions - 10

Factor Markets - Factor Prices - 18

Factor Markets - Market Power - 12, 13, 16, 21-24

Factor Markets - Mutiple Choice Questions - 9

Current Events - Holiday Employment

Current Events - Hurricanes and Strikes

Energy conservation,

Current Events - Energy Use

Energy consumption,

Current Events - Energy Use

Engel curve

• definition of,
  Elasticity - Demand - Income - 10

  example of,

  Elasticity - Demand - Income - 12-21

Entry barriers,

See Barriers to entry

Entry into industry,

Perfect Competition - Introduction - 6

Environmental problems,

Externalities - Industry Structure - 6

Current Events - Energy Use

See also Pollution - abatement

Equilibria,

Demand & Supply - Equilibrium - 5

Equilibrium, market

Demand & Supply - Equilibrium - 1

Demand & Supply - Market Adjustment - 1

Perfect Competition - Equilibrium - 4

Demand & Supply - Mutiple Choice Questions - 10

• nash equilibrium
  See Game theory - nash equilibrium

Equilibrium price and quantity,

Demand & Supply - Equilibrium - 1

Demand & Supply - Market Adjustment- 3

Demand & Supply - Mutiple Choice Questions - 2

Excess burden (Deadweight loss),

Consumer Choice - Tax-Surplus - 6-8

Excess capacity,

Monopoly - Entry Barriers - 5, 9-10

Monopolistic Competition - Excess Capacity - 1-5

Excise taxes,

Consumer Choice - Tax-Surplus - 1-8

Current Events - Cigarette Tax

Expectations,

See Demand - expectations

See Supply - expectations

Expenditure compensation,

Consumer Choice - Income & Substitution Effect - 6-9

Consumer Choice - Income & Substitution Effect - Expenditure - 1-28

Externalities. See also Pollution

• cost-benefit analysis of,
  Externalities - Introduction - 1

  definition of,

  Externalities - Introduction - 1

  and industrial structure,

  Externalities - Industry Structure - 1-6

  negative vs. positive,

  Externalities - Introduction - 1

  optimal levels of,

  Externalities - Marketable Pollution Credits - 1

  pollution,

  See Pollution

  and profit maximizing

  • imperfectly competitive firm,
    Externalities - Industry Structure - 4-6

    perfectly competitive firm,

    Externalities - Industry Structure - 2-6

  and taxation,

  Externalities - Pollution Taxes - 1

F

Factor demand,

See Factors of Production - Derived Demand

Factor demand curve,

Factor Markets - Factor Demand - 6-20

• elasticity of,
  Factor Markets - Factor Demand - 18-20

Factor markets,

Factor Markets - Introduction - 1

Factor price,

Factor Markets - Factor Prices - 1-18

Current Events - Holiday Employment

Factors,

See Factors of production

Factors of production,

Demand & Supply - Production Costs - 1

Factor Markets - Introduction - 1

• capital,
  Factor Markets - Firm Hiring - 5-24

  derived demand for,

  • definition of,
    Factor Markets - Factor Demand - 1, 15

    example of,

    Factor Markets - Factor Prices - 2

    Factor Markets - Mutiple Choice Questions - 6,7

    Current Events - Holiday Employment

  labor,

  See Labor

  markets for,

  See Factor markets

  marginal factor cost (MFC),

  Factor Markets - Market Power - 6-18

  Factor Markets - Mutiple Choice Questions - 12

  marginal revenue product (MRP),

  Factor Markets - Factor Demand - 5-20

  Factor Markets - Market Power - 2-19

  Factor Markets - Mutiple Choice Questions - 1,2,3

  marginal product of,

  Factor Markets - Factor Demand - 3-7

  Factor Markets - Mutiple Choice Questions - 2

  price paid for,

  Factor Markets - Factor Prices - 1

  variable factors,

  Production Costs- Diminishing Returns - 1

  wage paid for,

  Factor Markets - Factor Supply - 2-18

  Factor Markets - Factor Prices - 1-18

  Factor Markets - Mutiple Choice Questions - 1, 10-14

Federal Trade Commission (FTC),

Current Events - Productivity

Current Events - Microsoft and DOJ

Firms

• and monopoly,
  Monopoly - Introduction - 2

  and monopolitic competition,

  Monopolistic Competition - Introduction - 2

  and oligopoly,

  Oligopoly - Introduction - 2

  and perfect competition,

  Perfect Competition - Introduction - 2

Fixed costs

• average fixed cost (AFC),
  See Average fixed cost

  definition of,

  Production Costs - Fixed and Variable Costs - 1

  change in,

  Production Costs - Cost Shifts - 1-2

  Perfect Competition - Cost Change - 12-17

  Perfect Competition - Mutiple Choice Questions - 3

  Monopoly - Cost Change - 7-13

  Monopoly - Mutiple Choice Questions - 6-7

  Monopolistic Competition - Cost Change - 9-14

  Factor Markets - Mutiple Choice Questions - 19-20

  computation of,

  Production Costs- Cost Areas - 3

  Perfect Competition - Short Run Shut Down - 5

  examples of,

  Production Costs - Fixed and Variable Costs - 1-2

  Production Costs- Cost Curves - 2

  Perfect Competition - Cost Change - 1

  Production Costs - Mutiple Choice Questions - 12

  Perfect Competition - Mutiple Choice Questions - 26-28

  total fixed costs

  See Total Fixed Costs

Fixed factors,

Production Costs - Diminishing Returns - 1-5

Production Costs - Marginal Product - 1

Perfect Competition - Cost Change - 2

Forgone costs,

Perfect Competition - Short Run - 6

Forgone income,

Introduction - Cost & Profit - 4-7

Introduction - Opportunity Costs - 5

Introduction - Mutiple Choice Questions - 1

Monopolistic Competition - Entry Barriers - 4

Monopolistic Competition - Mutiple Choice Questions - 1

Forgone interest,

Introduction - Mutiple Choice Questions - 2

Perfect Competition - Cost Change - 1

Monopoly - Cost Change - 7

Factor Markets - Present Value - 7

Forgone opportunity,

Introduction - Cost & Profit - 1,5

Introduction - Opportunity Costs - 7

Introduction - PPF - 1

Forgone opportunity,

Introduction - Cost & Profit - 1,5

Forgone salary (ies),

Production Costs - Short Run Costs - 1

Monopoly - Cost Change - 1,7

Monopolistic Competition - Mutiple Choice Questions - 1

Free entry,

Monopolistic Competition - Introduction - 2,6

Perfect Competition - Introduction - 2,6

Free exit,

Monopolistic Competition - Introduction - 2,6

Perfect Competition - Introduction - 2,6

Free rider,

Public Economics - Free Rider - 1-5

G

Game theory

• definition of,
  Oligopoly - Game Theory Introduction - 1-2

  dominant strategy

  Oligopoly - Dominant Strategy - 1-16

  Oligopoly - Dilemmas - 1-16

  Oligopoly - Dominated Strategies - 1-7

  Oligopoly - Nash Equilibrium - 1, 2, 10, 14

  Oligopoly - Repeated Games - 13-14

  Oligopoly - Mixed Strategies - 2

  Oligopoly - Mutiple Choice Questions - 2,3,9,10

  Current Events - TV Reruns

  dominated strategies,

  Oligopoly - Dominated Strategies - 1-7

  Oligopoly - Mixed Strategies - 1

  Oligopoly - Mutiple Choice Questions - 6

  game tree,

  Oligopoly - Game Theory Introduction - 8-9

  Oligopoly - Sequential Games - 1- 12

  Current Events - Name Game 98

  nash equilibrium,

  Oligopoly - Nash Equilibrium - 1-14

  Oligopoly - Repeated Games - 1, 15

  Oligopoly - Mixed Strategies - 1, 3, 12

  Oligopoly - Mutiple Choice Questions - 5,7,8,11,18

  payoff matrix,

  Oligopoly - Game Theory Introduction - 3-7

  Oligopoly - Mutiple Choice Questions - 1-11,17-19

  Current Events - TV Reruns

  Current Events - Name Game 98

  Current Events - Oil Price Increases

  prisoners' dilemma,

  Oligopoly - Repeated Games - 1

  Oligopoly - Dilemmas - 1-8

  Oligopoly - Mutiple Choice Questions - 2,10

  Current Events - TV Reruns

  Current Events - Oil Price Increases

  repeated game (s),

  Oligopoly - Dilemmas - 11

  Oligopoly - Repeated Games - 1

  Current Events - Oil Price Increases

  sequential games,

  Oligopoly - Sequential Games - 1-12

  Current Events - TV Reruns

Giffen goods,

Demand & Supply - Exceptions - 7

Consumer Choice - Income & Substitution Effect - Expenditure - 19-28

Consumer Choice - Income & Substitution Effect - Utility - 19-28

Goods and services,

See Giffen goods

See Inferior goods

See Normal goods

See Normal goods - luxury goods

See Normal goods - necessity goods

See Outputs

Government,

Demand & Supply - Equilibrium - 6

Monopoly - Introduction - 4

Monopoly - Barriers - 6

Public Goods - Introduction - 1

Public Goods - Optimal Provision - 3

Demand & Supply - Mutiple Choice Questions - 6,7,13

See also Price ceiling

See also Price floor

See also Regulation

See also Taxes

Graphs,

Introduction - Graphs - 1-11

H

Health care cost,

Externalities - Pollution Taxes - 3

Households,

Introduction - Micro - 4

Public Goods - Demand for Public Goods - 1

• income,
  Demand & Supply - Equilibrium - 10
  Consumer Choice - Introduction - 1
  Elasticity - Mutiple Choice Questions - 13

Housing,

Demand & Supply - Equilibrium - 9,10

• and demand,
  Factor Markets - Factor Prices - 2,3

  and elasticity,

  Elasticity - Supply - 4

  Elasticity - Market Adjustment - 7

  graphical trade-off,

  Introduction - Production Possibilities - 12-18

Homogeneous products,

Perfect Competition - Introduction - 1

Perfect Competition - Equilibrium - 1

Perfect Competition - Firm Demand - 1

I

Imperfect competition,

Factor Markets - Factor Demand - 10

See Oligopoly

See Monopoly

Income

• and choice,
  Consumer Choice - Budget Constraint - 1-5
  Consumer Choice - Utility Maximization - 1

  and demand,

  Perfect Competition - Demand Change - 2

  Perfect Competition - Equilibrium - 5

  elasticity,

  See Elasticity - income elasticity of demand

  low,

  Demand & Supply - Equilibrium - 9-10

Income demand curve,

See Engel curve

Income effect (of a price change),

Consumer Choice - Income And Substitution Effect - 1-9

Factor Markets - Factor Supply - 7

Factor Markets - Mutiple Choice Questions - 5

Income elasticity of demand,

See Elasticity - income elasticity of demand

Increasing returns to scale (IRS),

Production Costs - Long Run Costs - 3-5, 9

Factor Markets - Mutiple Choice Questions - 18

Indeterminate price &/or quantity,

Demand & Supply - Market Adjust - 11

Demand & Supply - Mutiple Choice Questions - 9

Factor Markets - Mutiple Choice Questions - 7

Indifference curves,

Consumer Choice - Introduction - 3

Consumer Choice - Indifference Curves - 1

Indirect costs,

Introduction - Cost & Profit - 1

Introduction - Opportunity Costs - 2

Industrial organization,

Perfect Competition - Introduction - 1

Industrial structure

• definition,
  Perfect Competition - Introduction - 1

  and externalities,

  See Externalities

Industry,

Perfect Competition - Introduction - 1

Industry supply curve,

See Supply Curve - Industry Supply Curve

Inefficiency,

Externalities - Industry Structure - 1,5

Inefficient,

Introduction - PPF - 14

Inelastic demand,

Elasticity - Demand - Own Price - 6-23

Elasticity - Own Price - Revenue - 1-9

Elasticity - Market Adjustment - 1-10

Elasticity - Mutiple Choice Questions - 6,7,10,14

• and factor demand,
  Factor Markets - Factor Demand - 18-20

  and inferior goods,

  Consumer Choice - Income & Substitution Effect - Utility Compensation - 18,26,28

  Consumer Choice - Income & Substitution Effect - Expenditure Compensation - 18,26,28

  and kinked demand,

  Oligopoly - Kinked Demand - 1

  and labor demand,

  Factor Markets - Market Power - 22

  perfectly, shown graphically

  Elasticity - Demand - Own Price - 23

  and price discrimination,

  Monopoly - Price Discrimination - 3-7

  and tax surplus,

  Consumer Choice - Tax-Surplus - 7,8
  

Current Events - Cigarette Tax

Current Events - Drug Bust

Current Events - Energy Use

Current Events - Oil Price Increases

Current Events - Surf Fashions

Inelasticity,

See Inelastic demand

See Inelastic supply

Inelastic supply,

Elasticity - Supply - 2,4

Elasticity - Market Adjustment - 3,8-0

Factor Markets - Economic Rents - 2

Factor Markets - Factor Supply - 18

Factor Markets - Factor Prices - 11-15

Current Events - Drug Bust

Inferior goods,

Demand And Supply - Normal And Inferior - 1-4

Demand And Supply - Market Adjustment - 4

Elasticity - Demand - Income - 1, 2, 5, 6, 9-11, 19

Elasticity - Demand - Income - 1, 2, 5, 6, 9-11, 19

Elasticity - Mutiple Choice Questions - 1,7,14,18

Consumer Choice - Utility Maximization - 5

Consumer Choice - Income & Substitution Effect - 2

Consumer Choice - Income & Substitution Effect - Utility Compensation - 12-28

Consumer Choice - Income & Substitution Effect - Expenditure Compensation - 12-28

Inflation,

Factor Markets - Present Value - 19

Inputs,

See Factors of production

Insurance, as a fixed cost,

Production Costs - Short Run Costs - 1

Intangible aspect of decision making

Introduction - Cost & Profit - 6

Interest rate,

Monopolistic Competition - Entry Barriers - 5-8

Monopolistic Competition - Mutiple Choice Questions - 7,11

Oligopoly - Repeated Games - 8

Factor Markets - Present Value - 2-19

Factor Markets - Mutiple Choice Questions - 22-23

Interest bearing investment,

Factor Markets - Present Value - 2

Internet,

Introduction - Opportunity Costs - 1

Public Goods - Optimal Provision - 2

Current Events - Microsoft and DOJ

Inverse relationship,

See Negative relationship

Investment,

Introduction - Mutiple Choice Questions - 2

Perfect Competition - Equilibrium - 3, 7, 10

Monopolistic Competition - Entry Barriers - 5-6

Monopolistic Competition - Mutiple Choice Questions - 11

Factor Markets - Present Value - 2-19

Factor Markets - Mutiple Choice Questions - 22-23

Investment goods,

Demand And Supply - Expectations - 2

Isocost,

Factor Markets - Firm Hiring - 13-17, 23

Factor Markets - Mutiple Choice Questions - 15-17

Isoquant,

Factor Markets - Firm Hiring - 7-19

Factor Markets - Mutiple Choice Questions - 15-18

J

Jobs

Introduction - Cost & Profit - 6

Factor Markets - Factor Supply - 5

Factor Markets - Factor Prices - 16

Current Events - Holiday Employment

Justice Department

See U.S. Department of Justice

K

Kinked demand curve

Oligopoly - Kinked Demand - 2-5

Oligopoly - Mutiple Choice Questions - 14,15

L

Labor,

Demand & Supply - Production Costs - 1

Factor Markets - Firm Hiring - 5-24

Factor Markets - Mutiple Choice Questions - 8,12-15

Current Events - Productivity

Current Events - Holiday Employment

Labor Department,

See U.S. Department of Labor

Labor supply,

See Supply of labor

Labor supply curve,

See also Supply of labor curve

Factor Markets - Factor Supply - 6-11,14,17

Factor Markets - Market Power - 14,19,21

Factor Markets - Mutiple Choice Questions - 5,7,8,11-14

• Backward bending labor supply curve,
  See Supply of labor curve - backward bending

Labor unions,

Factor Markets - Factor Supply - 18

Factor Markets - Market Power - 20-24

Land,

Production Costs - Short Run Costs - 2

Factor Markets - Economic Rents - 1

Perfect Competition - Mutiple Choice Questions - 26

Law of demand

• definition of,
  Demand & Supply - Law of Demand - 1-2

  exception to the law of demand,

  Demand & Supply - Exceptions - 1-2

  example of,

  Consumer Choice - Utility Maximization - 4

  and the inverse relationship,

  Demand & Supply - Law of Demand - 2

Law of diminishing returns,

Production Costs - Cost Curves - 4

Production Costs - Diminishing Returns - 2-6

Production Costs - Long Run Costs - 1

Production Costs - Marginal Cost - 1

Production Costs - Marginal Product - 1-2

Factor Markets - Factor Demand - 4

Law of supply,

• definition of,
  Demand & Supply - Law of Supply - 1-4

  example of,

  Elasticity - Supply - 1

Legislation

• antitrust,
  See Antitrust law

Leisure time,

Factor Markets - Factor Supply - 1-7

• opportunity cost of,
  Factor Markets - Factor Supply - 1

Licensing, as a market entry barrier,

Perfect Competition - Introduction - 6

Perfect Competition - Cost Change - 1

Monopoly - Introduction - 4

Monopoly - Entry Barriers - 5,6,9

Current Events - Microsoft and DOJ

Limit pricing,

Monopoly - Entry Barriers - 5,9,12-15

Linear relationship,

Introduction - Graphs - 4,6

Demand & Supply - Schedules & Equations - 4

Long run,

Production Costs - Short & Long Run - 2

Production Costs - Long Run Costs - 1

Long-run average cost (LRAC),

Production Costs - Long Run Costs - 2

Long-run costs,

Production Costs - Long Run Costs - 1-9

Long-run costs curve,

Production Costs - Long Run Costs - 3-9

Long-run equilibrium

• for a monopolist,
  Monopoly - Cost Change - 9, 12

  for a monopolistic competitor,

  Monopolistic Competition - Cost Change - 4-9, 11

  for a perfect competitor,

  Perfect Competition - Equilibrium - 3-14

  Perfect Competition - Mutiple Choice Questions - 2,8,9,15,17,18,23,25

Current Events - Drug Bust

Long-run marginal cost (LRMC),

Production Costs - Long Run Costs - 3-9

Long-run shut down

• for a perfect competitor,
  Perfect Competition - Short Run Shut Down - 1
  Perfect Competition - Equilibrium - 1-2

Loss,

See Economic loss

Luxury goods,

Elasticity - Demand - Income - 7-9, 11-15, 20

Elasticity - Mutiple Choice Questions - 1,4,13

M

Manufacturing sector,

See Sector - manufacturing

Market economies,

Factor Markets - Market-Factors - 1,16

Market failure,

Externalities - Marketable Pollution Credits - 8

Marginal analysis,

Perfect Competition - Firm Supply - 5

Marginal cost (MC)

Production Costs - Mutiple Choice Questions - 4,6,15,16,17

• calculation of,
  Production Costs - Marginal Cost - 2-3

  definition of,

  Production Costs - Marginal Cost - 1

  curve

  Production Costs - Cost Curves - 3-4

  • with average variable cost and average total cost
    Production Costs - Cost Curves - 5-8

Marginal cost - marginal benefit analysis,

Externalities - Introduction - 1

Marginal factor cost (MFC),

See Factors of production - marginal factor cost

Marginal physical product (MPP),

See Marginal product

Marginal product (MP),

Production Costs- Diminishing Returns - 3

Production Costs- Marginal Product - 1-2

Factor Markets - Factor Demand - 3-20

Production Costs - Mutiple Choice Questions - 13

Current Events - Productivity

Marginal product of capital (MP_K),

Factor Markets - Firm Hiring - 11-24

Factor Markets - Mutiple Choice Questions - 15-16

Marginal product of labor (MP_L),

Factor Markets - Firm Hiring - 11-24

Factor Markets - Mutiple Choice Questions - 15-16

Marginal rate of substitution (MRS),

Consumer Choice - Indifference Curves - 6-8

Consumer Choice - Utility Maximization - 4

Marginal rate of technical substitution,

Factor Markets - Firm Hiring - 10

Factor Markets - Mutiple Choice Questions - 16

Marginal revenue (MR),

Perfect Competition - Firm Demand - 3

Monopoly - Profit Maximization - 1-6

Monopolistic Competition - Introduction - 4-5, 10

Oligopoly - Kinked Demand - 4

Factor Markets - Factor Demand - 5-20

Current Events - Productivity

Marginal revenue product (MRP),

Factor Markets - Factor Demand - 5-20

Factor Markets - Market Power - 2-8

Factor Markets - Firm Hiring - 2-4

Factor Markets - Mutiple Choice Questions - 1-4,9

Current Events - Productivity

Marginal technical rate of substitution (MTRS)

See Marginal rate of technical substitution

Marginal utility (MU)

Consumer Choice - Surplus - 4

Consumer Choice - Curves - 8

• and Marginal cost with public goods,
  Public Goods - Demand for Public Goods - 1
  Public Goods - Free Rider - 1-4
  Public Goods - Optimal Provision - 1

  definition of,

  Consumer Choice - Utility - 2

  shown graphically,

  Consumer Choice - Utility - 5-8

Marketable pollution credits,

See Pollution - credits

Market adjustment,

Demand & Supply - Market Adjustment - 1-15

Market equilibrium,

See Equilibrium

Market power,

Factor Markets - Market Power - 1

Market price,

Demand & Supply - Law of Supply - 1

Demand & Supply - Equilibrium - 1

Demand & Supply - Other Output Price - 1

Elasticity - Introduction - 1

Perfect Competition - Cost Change - 11

Perfect Competition - Equilibrium - 1

Perfect Competition - Firm Supply - 7

Maximum efficient scale (Max ES),

Production Costs - Long Run Costs - 8-9

Merger,

Monopoly - Introduction - 5

Microeconomics

• definition of,
  Introduction - Micro - 4

Minimum efficient scale (Min ES),

Production Costs - Long Run Costs - 8-9

Minimum of Average Total Cost (ATC),

See Average Total Cost - minimized

Minimum wage,

Factor Markets - Market Power - 12-16

Minimum wage law,

Factor Markets - Market Power - 12-13

Monopolistic competition

• change in costs,
  Monopolistic Competition - Cost Change - 1-14
  Monopolistic Competition - Mutiple Choice Questions - 5,8,9,10

  characteristics of,

  Monopolistic Competition - Introduction - 2-10

  definition of,

  Monopolistic Competition - Introduction - 1

  demand curve for,

  Monopolistic Competition - Introduction - 4

  demand in monopolistically competitive markets

  • change in demand,
    Monopolistic Competition - Demand Change - 1-11
    Monopolistic Competition - Mutiple Choice Questions - 2

  marginal revenue and demand,

  Monopolistic Competition - Demand Change - 1-11

  entry barriers,

  Monopolistic Competition - Entry Barriers - 1-9

  Monopolistic Competition - Mutiple Choice Questions - 7,11

  exit from industry,

  Monopolistic Competition - Introduction - 9-10

  Monopolistic Competition - Mutiple Choice Questions - 2

  free entry into industry,

  Monopolistic Competition - Excess Capacity - 1

  Monopolistic Competition - Mutiple Choice Questions - 1,3

  long run,

  Monopolistic Competition - Mutiple Choice Questions - 6,9

  and losses,

  Monopolistic Competition - Cost Change - 3, 10

  Monopolistic Competition - Excess Capacity - 4

  and marginal cost,

  Monopolistic Competition - Introduction - 5

  Monopolistic Competition - Cost Change - 2

  Monopolistic Competition - Mutiple Choice Questions - 3

  and marginal revenue,

  Monopolistic Competition - Introduction - 4-5, 10

  Monopolistic Competition - Cost Change - 8-13

  Monopolistic Competition - Demand Change - 2, 8, 9, 11

  and profit,

  Monopolistic Competition - Demand Change - 4

  Monopolistic Competition - Cost Change - 7

  Monopolistic Competition - Excess Capacity - 2

  Monopolistic Competition - Mutiple Choice Questions - 5,8,9,10

  profit maximization in,

  Monopolistic Competition - Demand Change - 9

  Monopolistic Competition - Cost Change - 2, 10

  Monopolistic Competition - Excess Capacity - 4

  Monopolistic Competition - Mutiple Choice Questions - 4

Monopoly

• change in costs,
  Monopoly - Introduction - 2
  Monopoly - Mutiple Choice Questions - 6,7,10,14

  characteristics of,

  Monopoly - Introduction - 2

  definition of,

  Monopoly - Introduction - 1-5

  demand curve for,

  Monopoly - Profit Maximization - 4

  Monopoly - Mutiple Choice Questions - 8,9

  demand in monopoly markets

  • change in demand,
    Monopoly - Demand Change - 1-8

  marginal revenue and demand,

  Monopoly - Profit Maximization - 4-6

  entry barriers,

  Monopoly - Entry Barriers - 1-17

  exit from industry,

  Monopoly - Introduction - 2

  Monopoly - Profit Maximization - 14

  long run,

  Monopoly - Entry Barriers - 13-14, 17

  Monopoly - Profit Maximization - 13-14, 16

  Monopoly - Mutiple Choice Questions - 3

  and losses,

  Monopoly - Introduction - 1-5

  Monopoly - Profit Maximization - 8, 14-15

  natural,

  Production Costs - Long Run Costs - 4

  Monopoly - Introduction - 5

  and marginal cost,

  Monopoly - Profit Maximization - 7

  Monopoly - Mutiple Choice Questions - 16,17

  and marginal revenue,

  Monopoly - Profit Maximization - 1-6

  Monopoly - Demand Change - 1, 3, 7

  Monopoly - Mutiple Choice Questions - 13

  and price discrimination,

  Monopoly - Price Discrimination - 1-9

  Monopoly - Mutiple Choice Questions - 4,5,12

  and profit,

  Monopoly - Introduction - 3

  Monopoly - Profit Maximization - 2-16

  Monopoly - Mutiple Choice Questions - 2,11,15

  profit maximization in,

  Monopoly - Profit Maximization - 7-12

  Monopoly - Mutiple Choice Questions - 1,2,3

Monopoly rents,

See Economic rents

Monopsonist,

Factor Markets - Market Power - 4-19

Factor Markets - Mutiple Choice Questions - 1,12

Monopsony,

Factor Markets - Market Power - 4-20

Factor Markets - Mutiple Choice Questions - 1,12,13

Movement along demand curve,

See Demand curve - movement along

Movement along supply curve,

See Supply curve - movement along

N

Nash equilibrium

See Game theory - nash equilibrium

Natural monopoly

See Monopoly - natural

Necessity goods,

Elasticity - Demand - Income - 7-9, 16, 21

Negative relationship,

Introduction - Graphs - 6,7

Demand & Supply - Demand Introduction - 2-3

Demand And Supply - Law of Demand - 2

Nonlinear pricing,

Monopoly - Price Discrimination - 2

Nonlinear relationship,

Introduction - Graphs - 5,7

Non-rivalness in consumption of public goods,

See Public good - non-rivalness

Normal goods,

Demand & Supply - Normal & Inferior - 1-4

Elasticity - Demand - Income - 1, 6-11, 18

Consumer Choice - Income and Substitution Effect - 1

Elasticity - Mutiple Choice Questions - 13,14

• necessity goods,
  See Necessity goods

  luxury goods,

  See Luxury goods

O

Oil market,

Current Events - Energy Use

Current Events - Oil Price Increases

Oil prices,

Current Events - Energy Use

Current Events - Oil Price Increases

Oil Producing Countries (OPC),

Current Events - Oil Price Increases

See also Organization of Petroleum Exporting Countries (OPEC)

Oligopolists' dilemma. See also Game theory - prisoners' dilemma

Oligopoly - Introduction - 7

Oligopoly - Dilemmas - 1, 9

Oligopoly - Repeated Games - 1-2, 11

Oligopoly - Mutiple Choice Questions - 2,7,10

Current Events - TV Reruns

Current Events - Oil Price Increases

Oligopoly

• characteristics of,
  Oligopoly - Introduction - 1-7

  and collusion,

  See Collusion

  demand curve for,

  See Kinked demand curve

  demand in oligopoly markets

  • marginal revenue and demand,
    Oligopoly - Introduction - 4-6
    Oligopoly - Kinked Demand - 4

  and game theory,

  See Game theory

  and marginal cost,

  Oligopoly - Kinked Demand - 5-6

  Oligopoly - Mutiple Choice Questions - 16

  and marginal revenue,

  Oligopoly - Kinked Demand - 4-6

  Oligopoly - Mutiple Choice Questions - 14

  and product differentiation,

  Oligopoly - Introduction - 2, 7

  and profit,

  Oligopoly - Dominant Strategy - 2-4, 10

  Oligopoly - Mutiple Choice Questions - 15,17

  and profit maximization,

  Oligopoly - Introduction - 3-4

  Oligopoly - Game Theory Introduction - 2

  Oligopoly - Kinked Demand - 1, 3, 6

  Oligopoly - Mutiple Choice Questions - 12

OPEC (Organization of Petroleum Exporting Countries),

See Organization of Petroleum Exporting Countries (OPEC)

Opportunity cost,

• definition of,
  Introduction - Cost & Profit - 1
  Introduction - Opportunity Costs - 2

  and demand and supply,

  Demand & Supply - Law of Supply - 3

  Demand & Supply - Other Output - 1

  Demand & Supply - Production Costs - 1

  and factor markets,

  Factor Markets - Supply - 6

  Factor Markets - Present Value- 7

  Factor Markets - Economic Rents - 1

  and monopolistic competitors,

  Monopolistic Competition- Entry Barriers - 6

  and production possibilities frontier,

  Introduction - Production Possibilities - 1-20

  Introduction - Mutiple Choice Questions - 3-11

  Current Events - Hurricanes and Strikes

Optimal provision of public goods. See also Allocative Efficiency

Public Economics - Optimal Provision - 1-3

Public Economics - Free Rider - 1, 3

Organization of Petroleum Exporting Countries (OPEC),

Current Events - Energy Use

Current Events - Oil Price Increases

Output (s)

• changes in,
  Production Costs - Curves - 1-5
  Production Costs - Cost Shifts - 3
  Current Events - Productivity
  Current Events - Oil Price Increases
  Current Events - Drug Bust

  definition of,

  Factor Markets - Introduction - 2

  total output,

  Factor Markets - Factor Demand - 2

Own price elasticity of demand,

See Price elasticity of demand

P

Patent (s)

• as a barrier to entry,
  Monopoly - Entry Barriers - 5,6
  Monopoly - Mutiple Choice Questions - 9
  Perfect Competition - Introduction - 6

  See also Barriers to entry

Payoff matrix

See Game theory - payoff matrix

Perfect competition (Perfectly competitive market or industry)

• change in costs,
  Perfect Competition - Cost Change - 1-19

  characteristics of,

  Perfect Competition - Introduction - 2-7

  definition of,

  Demand & Supply - Law of Supply - 3

  Perfect Competition - Introduction - 3

  demand in perfectly competitive markets,

  Perfect Competition - Firm Demand - 1-4

  • change in demand,
    Perfect Competition - Demand Change - 1-11

  entry into and exit from industry,

  Perfect Competition - Introduction - 2, 6

  Perfect Competition - Equilibrium - 3

  examples of,

  Perfect Competition - Mutiple Choice Questions - 1-28

  and factor markets,

  Factor Markets - Factor Demand - 6-13

  Factor Markets - Firm Hiring - 2

  Factor Markets - Mutiple Choice Questions - 2,4,14,16,19

  and fixed costs,

  Perfect Competition - Short Run Shut Down - 5

  Perfect Competition - Cost Change - 1,12-17

  in the long run,

  Perfect Competition - Mutiple Choice Questions - 3

  long-run equilibrium,

  Perfect Competition - Equilibrium - 3-14

  Perfect Competition - Mutiple Choice Questions - 2,8,9,15,17,18,23,25

  long-run shut down,

  Perfect Competition - Short Run Shut Down - 1

  Perfect Competition - Equilibrium - 1

  and losses,

  Perfect Competition - Short Run - 10

  Perfect Competition - Demand Change - 9

  and marginal cost,

  Perfect Competition - Firm Supply - 6

  and marginal revenue,

  Perfect Competition - Firm Demand - 3

  and profit,

  Perfect Competition - Short Run - 6

  Perfect Competition - Demand Change - 4

  Perfect Competition - Mutiple Choice Questions - 27

  profit maximization in,

  Perfect Competition - Short Run - 3

  Perfect Competition - Firm Supply - 4

  Perfect Competition - Mutiple Choice Questions - 4,20

  in the short run,

  Perfect Competition - Short Run - 1

  Perfect Competition - Mutiple Choice Questions - 1,3,7,16,26

  short run equilibrium,

  Perfect Competition - Equilibrium - 14

  Perfect Competition - Demand Change - 4

  Perfect Competition - Mutiple Choice Questions - 2

  short run shut down,

  Perfect Competition - Short Run Shut Down - 1

  shut down price,

  Perfect Competition - Equilibrium - 2

Perfectly competitive firm

Perfect Competition - Mutiple Choice Questions - 1,10-13,20,23

• and externalities,
  Externalities - Industry Structure - 1-5
  Externalities - Pollution Taxes - 2-5

  and factor markets,

  Externalities - Industry-Efficiency - 3-5

  Factor Markets - Firm Hiring - 2

  Factor Markets - Mutiple Choice Questions - 16

  and long run supply curve,

  Perfect Competition - Long Run Supply - 8

  and marginal revenue,

  Perfect Competition - Firm Demand - 6

  and shut down price,

  Perfect Competition - Equilibrium - 1-4

  Perfect Competition - Shut Down - 14

  and supply,

  Perfect Competition - Firm Supply - 1-9

Perfectly elastic

• demand,
  Elasticity - Demand Own Price - 24

  supply,

  Current Events - Microsoft and DOJ

Perfectly inelastic

See also Inelastic demand

• demand,
  Elasticity - Demand Own Price - 23

  supply,

  Factor Markets - Economic Rents - 1

  Current Events - Drug Bust

Pollution

• abatement (reduction),
  Externalities - Optimal Pollution - 2-9

  • marginal benefit of abatement (MBA),
    Externalities - Optimal Pollution - 3-7

    marginal cost of abatement (MCA),

    Externalities - Optimal Pollution - 4-7

    optimal amount of,

    Externalities - Optimal Pollution - 5-7

    Externalities - Marketable Pollution Credits - 1-8

  air pollution,

  Externalities - Introduction - 1

  Externalities - Marketable Pollution Credits - 2,4

  Current Events - Energy Use

  credits, marketable pollution credits

  or tradable pollution credits

  Externalities - Marketable Pollution Credits - 1

  optimal level of,

  Externalities - Optimal Pollution - 1-9

  tax and subsidy, Pigouvian

  Externalities - Pollution Taxes - 1-5

  zero pollution,

  Externalities - Optimal Pollution - 1, 5-7

Population

• and demand,
  Demand & Supply - Law of Demand - 2
  Factor Markets - Factor Prices - 2
  Public Goods - Optimal Provision - 2

  and the marginal benefit of abatement,

  Externalities - Optimal Pollution - 6

Positive relationship between variables,

Introduction - Graphs - 5-6

Demand & Supply - Supply Introduction - 1-3

Preferences,

Consumer Choice - Preferences - 1

Introduction - Mutiple Choice Questions - 11

See also Utility

Present value,

Factor Markets - Present Value - 1-19

Price,

See Market price

• Equilibrium,
  Demand & Supply - Equilibrium - 1

  Relative price,

  Consumer Choice - Budget Constraint - 2

Price ceiling,

Demand & Supply - Equilibrium - 8

Demand & Supply - Mutiple Choice Questions - 7

Price discrimination,

Current Events - Oil Price Increases

Price elasticity of demand (Own Price),

• definition of,
  Elasticity - Demand - Own Price - 1

  elastic vs. inelastic,

  Elasticity - Demand - Own Price - 6

  example of,

  Elasticity - Mutiple Choice Questions - 5,6,8,9,11,15

  Current Events - Cigarette Tax

  and revenue,

  Elasticity - Demand Own Price - Revenue - 1-25

  Elasticity - Mutiple Choice Questions - 16

Price floor,

Demand & Supply - Equilibrium - 6

Demand & Supply - Mutiple Choice Questions - 6

Price inelastic demand,

See Inelastic demand

Price of complements,

Demand & Supply - Law of Demand - 2

Price of substitutes,

Demand & Supply - Law of Demand - 2

Price support,

Demand & Supply - Equilibrium - 6

• and agriculture,
  Demand & Supply - Equilibrium - 6

Price taker,

Demand & Supply - Law of Supply - 2

Perfect Competition - Firm Supply - 1

Perfect Competition - Firm Supply - 12

Factor Markets - Market Power - 1

Price theory,

Introduction - Micro - 4

Prisoners' dilemma,

See Game theory - prisoners' dilemma

Private good (s)

• vs. public good (s),
  Public Goods - Introduction - 2
  Public Goods - Demand for Public Goods - 2

  and marginal utility ,

  Public Goods - Optimal Provision - 1

Private marginal cost of production (PMC),

Externalities - Industry Structure - 2-6

Producers' surplus,

Consumer Choice - Tax-Surplus - 1

Product differentiation,

Perfect Competition - Introduction - 5

Monopolistic Competition - Excess Capacity - 5

Monopolistic Competition - Introduction - 3, 6

Production costs,

Demand & Supply - Law of Supply - 4

Production Costs - Introduction - 1

Production Costs - Mutiple Choice Questions - 1-17

Factor Markets - Mutiple Choice Questions - 8

• long run
  Production Costs - Long Run Costs - 1

Production possibilities frontier (PPF),

Introduction - PPF - 5

Introduction - Mutiple Choice Questions - 3

Current Events - Hurricanes and Strikes

• Preferred points,
  Introduction - Mutiple Choice Questions - 8

  Unattainable points,

  Introduction - PPF - 15

Production possibilities set,

Introduction - PPF - 14

Production technology,

Introduction - PPF - 15-17

Demand & Supply - Law of Supply - 4

Introduction - Mutiple Choice Questions - 6,9

Factor Markets - Firm Hiring - 25

• long run
  Production Costs - Short and Long Run Costs - 2
  Production Costs - Long Run Costs - 1

  and public goods

  Public Goods - Optimal Provision - 2

Productivity,

Introduction - PPF - 18

Production Costs - Cost Shift - 3, 4

Production Costs - Cost Change - 2

Monopoly - Mutiple Choice Questions - 10,11

Factor Markets - Factor Demand - 16-20

Factor Markets - Market Power - 24

Factor Markets - Mutiple Choice Questions - 7,9

Externalities - Optimal Pollution - 1

Current Events - Productivity

• of labor,
  Production Costs - Mutiple Choice Questions - 3

Products,

See Outputs

Profit (s),

Production Costs - Introduction - 1

Production Costs - Mutiple Choice Questions - 23

Elasticity - Own Price - Revenue - 10

Factor Markets - Mutiple Choice Questions - 7

Current Events - Drug Bust

Current Events - Oil Price Increases

Current Events - Productivity

• economic,
  See Economic profit

  vs. revenue,

  Elasticity - Own Price - Revenue - 4

Profit maximizing firm

• monopolist,
  Monopoly - Profit Maximization - 7

  perfect competitor,

  Perfect Competition - Short Run - 3

  Perfect Competition - Firm Supply - 4

  Perfect Competition - Mutiple Choice Questions - 4,20

Property tax

See Taxes - property

Public economics,

Public Economics - Introduction - 1

Public good (s)

• definition of,
  Public Economics - Introduction - 1, 2

  demand for,

  Public Economics - Demand for Public Goods - 1, 2

  and free rider problem,

  Public Economics - Free Rider - 1, 2

  marginal cost of production for,

  Public Economics - Optimal Provision - 1, 2

  marginal utility of,

  Public Economics - Optimal Provision - 1, 2

  Public Economics - Free Rider - 1, 2

  • marginal utilities, sum of
    Public Economics - Optimal Provision - 1, 2
    Public Economics - Free Rider - 2

  non-excludability of,

  Public Economics - Introduction - 1, 2

  non-rivalness in consumption of,

  Public Economics - Introduction - 1, 2

  Public Economics - Free Rider - 1

  optimal provision (allocative efficiency) of,

  See Optimal provision

Publicly provided goods,

Public Economics - Introduction - 2

Public policy,

See Government

See Legislation

See Regulation

Pure private good (s),

Public Economics - Introduction - 2

Pure public good (s),

Public Economics - Introduction - 2

Public Economics - Free Rider - 1

Q

Quantity demanded

• change in,
  Demand & Supply - Law of Demand - 3

  • vs. change in demand,
    Demand & Supply - Demand Introduction - 1
    Demand & Supply - Law of Demand - 4

  definition of,

  Demand & Supply - Demand Introduction - 1

  and elasticity,

  Elasticity - Introduction - 1

  Elasticity - Market Adjustment - 2

  in an equation,

  Demand & Supply - Schedules & Equations - 4

  and equilibrium,

  Demand & Supply - Equilibrium - 1

  Demand & Supply - Market Adjustment - 1

  in an equation,

  Demand & Supply - Equilibrium - 1

Quantity supplied

• change in,
  Demand & Supply - Law of Supply - 1
  Demand & Supply - Mutiple Choice Questions - 10

  • vs. change in supply,
    Demand & Supply - Mutiple Choice Questions - 10

  and cost of factors of production,

  Demand & Supply - Production Costs - 1

  definition of,

  Demand & Supply - Supply Introduction - 1

  and elasticity,

  Elasticity - Introduction - 1

  Elasticity - Market Adjustment - 3

  in an equation,

  Demand & Supply - Schedules & Equations - 5

  and equilibrium,

  Demand & Supply - Equilibrium - 1

  Demand & Supply - Market Adjustment - 1

R

Rate of interest

See Interest rate

Rate of return,

Perfect Competition - Short Run Equilibrium - 11

Rate of substitution,

Consumer Choice - Utility Maximization - 3

See also Marginal rate of substitution

See also Marginal rate of technical substitution

Rationing,

Demand & Supply - Equilibrium - 11

Recession,

Perfect Competition - Demand Change - 9

Oligopoly - Repeated Games - 6, 11

Current Events - Hurricanes and Strikes

Recycling,

Oligopoly - Dilemmas - 14, 15

Regulation,

Externalities - Marketable Pollution Credits - 1

Externalities - Pollution Taxes - 1

• in the absence of,
  Production Costs - Long Run Costs - 4

See also Antitrust law

See also Government

See also Price ceiling

See also Price floor

Related good (s)

See Complementary goods

See Substitute goods

Relationship

• inverse,
  See Negative relationship

  negative,

  See Negative relationship

  positive,

  See Positive relationship

Relative price,

Consumer Choice - Budget Constraint - 2

Rent, Economic

See Economic rents

Rent control,

Demand & Supply - Equilibrium - 9-10

Rent control laws,

Demand & Supply - Equilibrium - 10

Repeated game (s),

See Game theory - repeated game

Research,

Elasticity - Demand Own Price - 25

Oligopoly - Introduction - 7

Resources,

Introduction - Micro - 5

Introduction - Production Possibilities - 12

Current Events - Hurricanes and Strikes

Current Events - Productivity

See also Unemployed resources

Returns to scale

See Constant returns to scale (CRS)

See Decreasing returns to scale (DRS)

See Increasing returns to scale (IRS)

Revenue,

• definition of,
  Introduction - Cost & Profit - 2

  and price,

  Elasticity - Own Price - Revenue - 1

  Elasticity - Mutiple Choice Questions - 5,8,16

  raised by excise tax,

  Consumer Choice - Tax-Surplus - 3

  shown graphically,

  Perfect Competition - Short Run - 5

Risk,

Monopoly - Entry Barriers - 7

Oligopoly - Mixed Strategies - 5

S

Salary (ies),

Perfect Competition - Short Run Equilibrium - 5

Monopolistic Competition - Entry Barriers - 4

Factor Markets - Economic Rents - 2

Factor Markets - Factor Prices - 19

Current Events - TV Reruns

See also Factors of production - wage

• forgone,
  See Forgone salary

Sales

• and price,
  Demand & Supply - Introduction - 1
  Elasticity - Mutiple Choice Questions - 2

  • and exception to the law of demand,
    Demand & Supply - Exceptions - 2

  and revenue,

  Elasticity - Own Price - Revenue - 1

Sales tax,

See Taxes - sales

Savings,

Factor Markets - Present Value - 2

Satisfaction,

See Utility

Scale economies

See Economies of scale

Schedule

Demand & Supply - Schedule & Equations - 1

Sector

• manufacturing,
  Oligopoly - Introduction - 1

  service,

  Monopolistic Competition - Introduction - 1

  Factor Markets - Firm Hiring - 25

Service sector

See Sector - service

Sequential games,

See Game Theory - Sequential Games

Shortage,

Demand & Supply - Equilibrium - 1

Demand & Supply - Mutiple Choice Questions - 7

Current Events - Drug Bust

Short run,

Production Costs- Short & Long Run - 1

Perfect Competition - Short Run - 1

Perfect Competition - Mutiple Choice Questions - 1,3,7,16,26

Short-run costs,

Production Costs - Fixed and Variable Costs - 1

Short-run equilibrium,

Perfect Competition - Equilibrium - 14

Perfect Competition - Demand Change - 4

Perfect Competition - Mutiple Choice Questions - 2

Short-run shut down,

Perfect Competition - Short Run Shut Down - 1

Shut down price,

Perfect Competition - Equilibrium - 2

Slope in graph construction,

Introduction - Production Possibilities - 6

Consumer Choice - Budget Constraints - 2-5

Consumer Choice - Utility Maximization - 2

Consumer Choice - Curves - 6

Consumer Choice - Utility - 5

• and elasticity
  Elasticity - Demand - Own Price - 12

Social cost (s),

Externalities - Introduction - 2

Externalities - Industry Structure - 2

Externalities - Pollution Taxes - 1-4

Industry Policy - Efficiency- 14

See also Cost-benefit analysis

See also Social marginal cost

Social marginal cost of production (SMC),

Externalities - Industry Structure - 2-6

Social regulation,

See Regulation

Spending power,

Consumer Choice - Income and Substitution Effect - 5

Stock (s),

Demand And Supply - Expectations - 2

Stock prices,

Current Events - Oil Price Increases

Subsidy, Pigouvian

Externalities - Pollution Taxes - 3-5

Substitute goods (substitutes),

Demand & Supply - Law of Demand - 2

Demand & Supply - Substitutes & Complements - 1

Elasticity - Demand - Cross Price - 1

Elasticity - Mutiple Choice Questions - 10,11

Factor Markets - Mutiple Choice Questions - 6,7

Substitution effect (of a price change),

Consumer Choice - Income And Substitution Effect - 2

Factor Markets - Factor Supply - 7

Factor Markets - Mutiple Choice Questions - 5

Supply

• change in ,
  Demand & Supply - Market Adjustment - 7-8

  definition of,

  Demand & Supply - Supply Introduction - 1

  desired quantity supplied,

  Demand & Supply - Supply Introduction - 1

  expectations,

  Demand & Supply - Law of Supply - 4

  supply equation,

  Demand & Supply - Schedule & Equations - 5

  Demand & Supply - Mutiple Choice Questions - 5

Supply curve

• industry supply curve,
  Demand & Supply - Entry - 1
  Perfect Competition - Firm Supply - 2

  backward bending labor supply curve,

  See Supply of labor curve - backward bending

  labor supply curve,

  See Supply of labor curve

  long run supply curve,

  Perfect Competition - Long Run Supply - 1-10

  • movement along the supply curve ,
    Demand & Supply - Other Output Prices - 1
    Perfect Competition - Long Run Supply - 1
    Factor Markets - Factor Supply - 14

    negatively related; downward sloping,

    Perfect Competition - Mutiple Choice Questions - 19

    shift in supply,

    Perfect Competition - Mutiple Choice Questions - 24

  short run supply curve,

  Perfect Competition - Short Run - 2

  • movement along the supply curve,
    Demand & Supply - Other Output Prices - 1

    positively related,

    Demand & Supply - Supply Introduction - 2

    shift in supply,

    Demand & Supply - Other Output Prices - 1

    upward sloping,

    Demand & Supply - Supply Introduction - 3-5

Supply elasticity,

Elasticity - Supply - 2

Supply of labor,

Factor Markets - Factor Supply - 1-18

Supply of labor curve,

Factor Markets - Factor Supply - 2-18

Factor Markets - Market Power - 6-23

Factor Markets - Mutiple Choice Questions - 5,7,8,11-14

• backward bending,
  Factor Markets - Factor Supply - 7, 8
  Factors - Wage - Income And Substitution - 5-7
  Factor Markets - Mutiple Choice Questions - 5,11

  elasticity of,

  Factor Markets - Factor Supply - 17-18

  movement along the supply curve,

  Factor Markets - Factor Supply - 14

  shifts in individual labor supply,

  Factor Markets - Factor Supply - 11

  short run labor supply,

  Factor Markets - Factor Supply - 13

  upward sloping,

  Factor Markets - Factor Supply - 6

Supply schedule,

Demand & Supply - Schedule & Equations - 2

Support price,

See Price support

Surplus,

Demand & Supply - Equilibrium - 1

Demand & Supply - Mutiple Choice Questions - 6

See also Consumers' surplus

See also Producers' surplus

S

Salary (ies),

Perfect Competition - Short Run Equilibrium - 5

Monopolistic Competition - Entry Barriers - 4

Factor Markets - Economic Rents - 2

Factor Markets - Factor Prices - 19

Current Events - TV Reruns

See also Factors of production - wage

• forgone,
  See Forgone salary

Sales

• and price,
  Demand & Supply - Introduction - 1
  Elasticity - Mutiple Choice Questions - 2

  • and exception to the law of demand,
    Demand & Supply - Exceptions - 2

  and revenue,

  Elasticity - Own Price - Revenue - 1

Sales tax,

See Taxes - sales

Savings,

Factor Markets - Present Value - 2

Satisfaction,

See Utility

Scale economies

See Economies of scale

Schedule

Demand & Supply - Schedule & Equations - 1

Sector

• manufacturing,
  Oligopoly - Introduction - 1

  service,

  Monopolistic Competition - Introduction - 1

  Factor Markets - Firm Hiring - 25

Service sector

See Sector - service

Sequential games,

See Game Theory - Sequential Games

Shortage,

Demand & Supply - Equilibrium - 1

Demand & Supply - Mutiple Choice Questions - 7

Current Events - Drug Bust

Short run,

Production Costs- Short & Long Run - 1

Perfect Competition - Short Run - 1

Perfect Competition - Mutiple Choice Questions - 1,3,7,16,26

Short-run costs,

Production Costs - Fixed and Variable Costs - 1

Short-run equilibrium,

Perfect Competition - Equilibrium - 14

Perfect Competition - Demand Change - 4

Perfect Competition - Mutiple Choice Questions - 2

Short-run shut down,

Perfect Competition - Short Run Shut Down - 1

Shut down price,

Perfect Competition - Equilibrium - 2

Slope in graph construction,

Introduction - Production Possibilities - 6

Consumer Choice - Budget Constraints - 2-5

Consumer Choice - Utility Maximization - 2

Consumer Choice - Curves - 6

Consumer Choice - Utility - 5

• and elasticity
  Elasticity - Demand - Own Price - 12

Social cost (s),

Externalities - Introduction - 2

Externalities - Industry Structure - 2

Externalities - Pollution Taxes - 1-4

Industry Policy - Efficiency- 14

See also Cost-benefit analysis

See also Social marginal cost

Social marginal cost of production (SMC),

Externalities - Industry Structure - 2-6

Social regulation,

See Regulation

Spending power,

Consumer Choice - Income and Substitution Effect - 5

Stock (s),

Demand And Supply - Expectations - 2

Stock prices,

Current Events - Oil Price Increases

Subsidy, Pigouvian

Externalities - Pollution Taxes - 3-5

Substitute goods (substitutes),

Demand & Supply - Law of Demand - 2

Demand & Supply - Substitutes & Complements - 1

Elasticity - Demand - Cross Price - 1

Elasticity - Mutiple Choice Questions - 10,11

Factor Markets - Mutiple Choice Questions - 6,7

Substitution effect (of a price change),

Consumer Choice - Income And Substitution Effect - 2

Factor Markets - Factor Supply - 7

Factor Markets - Mutiple Choice Questions - 5

Supply

• change in ,
  Demand & Supply - Market Adjustment - 7-8

  definition of,

  Demand & Supply - Supply Introduction - 1

  desired quantity supplied,

  Demand & Supply - Supply Introduction - 1

  expectations,

  Demand & Supply - Law of Supply - 4

  supply equation,

  Demand & Supply - Schedule & Equations - 5

  Demand & Supply - Mutiple Choice Questions - 5

Supply curve

• industry supply curve,
  Demand & Supply - Entry - 1
  Perfect Competition - Firm Supply - 2

  backward bending labor supply curve,

  See Supply of labor curve - backward bending

  labor supply curve,

  See Supply of labor curve

  long run supply curve,

  Perfect Competition - Long Run Supply - 1-10

  • movement along the supply curve ,
    Demand & Supply - Other Output Prices - 1
    Perfect Competition - Long Run Supply - 1
    Factor Markets - Factor Supply - 14

    negatively related; downward sloping,

    Perfect Competition - Mutiple Choice Questions - 19

    shift in supply,

    Perfect Competition - Mutiple Choice Questions - 24

  short run supply curve,

  Perfect Competition - Short Run - 2

  • movement along the supply curve,
    Demand & Supply - Other Output Prices - 1

    positively related,

    Demand & Supply - Supply Introduction - 2

    shift in supply,

    Demand & Supply - Other Output Prices - 1

    upward sloping,

    Demand & Supply - Supply Introduction - 3-5

Supply elasticity,

Elasticity - Supply - 2

Supply of labor,

Factor Markets - Factor Supply - 1-18

Supply of labor curve,

Factor Markets - Factor Supply - 2-18

Factor Markets - Market Power - 6-23

Factor Markets - Mutiple Choice Questions - 5,7,8,11-14

• backward bending,
  Factor Markets - Factor Supply - 7, 8
  Factors - Wage - Income And Substitution - 5-7
  Factor Markets - Mutiple Choice Questions - 5,11

  elasticity of,

  Factor Markets - Factor Supply - 17-18

  movement along the supply curve,

  Factor Markets - Factor Supply - 14

  shifts in individual labor supply,

  Factor Markets - Factor Supply - 11

  short run labor supply,

  Factor Markets - Factor Supply - 13

  upward sloping,

  Factor Markets - Factor Supply - 6

Supply schedule,

Demand & Supply - Schedule & Equations - 2

Support price,

See Price support

Surplus,

Demand & Supply - Equilibrium - 1

Demand & Supply - Mutiple Choice Questions - 6

See also Consumers' surplus

See also Producers' surplus

T

Table showing demand and supply schedule,

Demand & Supply - Schedule & Equations - 1-3

Tacit collusion,

See Collusion

Takeover,

Industry Policy - Structure & Efficiency- 7,8

Tastes and demand,

Demand & Supply - Law of Demand - 2

See also Preferences

See also Utility

Taxes

• excise,
  Consumer Choice - Tax-Surplus - 1-8
  Current Events - Cigarette Tax

  and subsidies,

  Externalities - Pollution Taxes - 3, 5

  Pigouvian,

  Externalities - Pollution Taxes - 1-2, 4

  pollution,

  Externalities - Pollution Taxes - 1-5

  property,

  Production Costs - Fixed and Variable Costs - 1-2

  Perfect Competition - Cost Change - 1

  Monopolistic Competition - Cost Change - 9

  Monopoly - Cost Change - 8,11

  Production Costs - Mutiple Choice Questions - 12

  Perfect Competition - Mutiple Choice Questions - 26-28

  sales tax,

  Current Events - Cigarette Tax

Tax incidence,

Current Events - Cigarette Tax

Tax shift,

Current Events - Cigarette Tax

Technical rate of substitution (TRS),

See Production technology

See Rate of substitution

Technology,

See Production technology

Total cost,

Production Costs - Marginal Cost - 2

Perfect Competition - Short Run - 4

Production Costs - Mutiple Choice Questions - 8

Perfect Competition - Mutiple Choice Questions - 5,10

Total fixed costs (TFC),

Perfect Competition - Short Run - 2

Production Costs - Mutiple Choice Questions - 1,2,5,10,11

Perfect Competition - Mutiple Choice Questions - 12

Total profit

• and oligopoly,
  Oligopoly - Repeated Games - 3

Total revenue,

See Revenue

Total utility,

Consumer Choice - Utility - 3-7

Consumer Choice - Surplus - 1

Total variable costs (TVC),

Production Costs- Cost Computation - 2

Perfect Competition - Short Run - 6, 11

Production Costs - Mutiple Choice Questions - 9

Tradable pollution credits,

See Pollution - credits

Trade,

See Federal Trade Commission

Trademark,

Current Events - Name Game 98

trade-off (s),

Introduction - Production Possibilities - 1

Consumer Choice - Curves - 5

Factor Markets - Mutiple Choice Questions - 10

Transportation,

Demand & Supply - Production Costs - 1

Production Costs- Short Run Costs - 1

Production Costs- Cost and Profit - 3

Perfect Competition - Cost Change- 1

Transportation business,

Current Events - Oil Price Increases

Trust fund,

Factor Markets - Factor Supply - 9

U

Unemployed resources,

Introduction - PPF - 14,18

Introduction - Mutiple Choice Questions - 10

Current Events - Hurricanes and Strikes

Unemployment,

Monopolistic Competition - Cost Change - 1

Factor Markets - Market Power - 13, 16

Introduction - Mutiple Choice Questions - 10

Current Events - Holiday Employment

Current Events - Hurricanes and Strikes

Unions,

See Labor unions

U.S. Bureau of Census,

Elasticity - Mutiple Choice Questions - 13

U.S. Department of Energy,

Current Events - Energy Use

U.S. Department of Justice,

Monopoly - Introduction - 5

Current Events - Productivity

Current Events - Microsoft and DOJ

• Antitrust Division of,
  See Antitrust law

U.S. Department of Labor,

Current Events - Productivity

U.S. economy,

Current Events - Holiday Employment

Current Events - Hurricanes and Strikes

U.S. workers,

Current Events - Productivity

See also Workers

Utility, economic definition

Demand & Supply - Expectations - 2

Consumer Choice - Introduction - 2

Consumer Choice - Utility - 1

See also Preferences

See also Marginal utility

See also Total utility

Utility compensation,

Consumer Choice - Income & Substitution Effect - 8-9

Consumer Choice - Income & Substitution Effect - Utility - 1-28

Utility maximization,

Consumer Choice - Utility Maximization - 1

V

Variable costs

• average variable cost,
  See Average variable costs (AVC)

  definition of,

  Production Costs- Short Run Costs - 1

  Perfect Competition - Cost Change - 1

  graph of,

  Production Costs - Cost Curves - 8

  Production Costs - Cost Shifts - 1

  total variable costs,

  See Total variable costs

Variable factors (inputs)

See Factors of Production - Variable Factors

Variables

• shown graphically,
  Introduction - Graphs - 2

  percentage change of,

  Elasticity - Introduction - 3, 10

Very long run

• definition of,
  Production Costs- Short & Long Run - 2

W

Wage discrimination,

Factor Markets - Mutiple Choice Questions - 13

Wage rate,

Production Costs - Cost Shifts - 4,5

Factor Markets - Firm Hiring - 2,4,13

Wages,

Current Events - Holiday Employment

See also Factors of production - wage

Workers,

Current Events - Holiday Employment

Current Events - Productivity

X

X axis, in graphs

Introduction - Graphs - 2

Y

Y axis, in graphs

Introduction - Graphs - 2

Z

Zero profit

• and monopolistic competitors,
  Monopolistic Competition- Demand Change - 6
  Monopolistic Competition- Excess Capacity - 1

  and monopolists,

  Monopoly - Entry Barriers - 13

  Monopoly - Profit Max - 16

  and perfect competitors,

  Perfect Competition - Cost Change - 7

  Perfect Competition - Demand Change - 7

  Perfect Competition - Equilibrium - 12

  Perfect Competition - Long Run Supply - 10

  Perfect Competition - Short Run - 6, 11

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