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Microeconomics 1 Test

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1.
What is an inelastic demand of a good?
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2.
What is a price floor?
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3.
What is Cross Price Elasticity of demand?
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4.
How does the other factors (7) affect the supply curve?
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5.
Properties of preferences, what is Monotonicity?
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6.
How does the preferences/taste (2) affect the demand curve?
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7.
How does the expectations (6) affect the supply curve?
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8.
Graphically, how is a perfectly elastic curve?
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9.
How does the price (1) affect the supply curve?
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10.
Absolute price
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11.
Who tanks bigger tax burden?
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12.
Is there differences between seller tax and buyer tax?
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13.
What is consumer surplus?
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14.
What is the Utility Function u(.)?
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15.
How does the number of consumers (5) affect the demand curve?
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16.
Law of supply
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17.
How does the related goods (4) affect the demand curve?
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18.
What is a luxury?
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19.
What is the budget constraint and its formula?
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20.
About budget line, what are the gaphical caracteristics?
A.
Supply slope is always positive
B.
A change in Q smaller than 1% when price changes 1%. Elasticity<1.
C.
If a producer thinks price is going to go up, they will reduce the production today in order to make more benefit increasing the production when thr goods price increase. Viceversa
D.
Seller or buyer, depends on which side is less elastic
E.
The price "per se" of a good
F.
Both cases place a wedge between the price tha buyer buy and seller sell, the only difference is who pays the goverment
G.
A stop the goverment puts to the price, its the minimum price you can buy/sell a product
H.
A preference relation is monoton if "the more, the better" applies. i.e. Bundle A (3,6) > Bundle B (3,5)
I.
For example weather for agriculture, if the weather isn't favorable the production wil decrease, thus the curve shifts left
J.
The curve shifts to the right if the good is now more liked because for the same prices there are more buyers now. If disliked the curve shifts left, for the same price there are less buyers
K.
The difference between the amount buyer is willing to pay for a good and the amount he finally pays
L.
Measures how Q of a good changes when ther price of another good changes
M.
The price does not affect in the curve, it just moves along the slope. Higher price=higher supply and viceversa
N.
The budget constraint or budget line is the curve that represents income, price of two goods (x,y) and the quantity I can buy of each of them inside my budget. Formula is: m=Px*Qx+Py*Qy which expressed in a line ecuation is Qy=(m/Py)-(Px/Py) *x
O.
The slope is the relative price between x and y (-Px/Py). The cut with axis are (m/Py) in y axis and (m/Px) in axis x, this represents the maximum amount of good x or y, respectively that I can buy.
P.
Horizontal curve
Q.
Substitutes: If the price of butter increases, the demand of margarine increases. Complements: If the price of petrol icreases, the demand of cars decreases
R.
In plane x/y, represents the preference relation ">~" u(A) >=u(B) => A>~B
S.
E(m)>1
T.
With a rise in the nº of consumers, the curve shifts right, same price, more buyers. If the nº of buyer decreases, same price less demand
Type the Answer that corresponds to the displayed Question.
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21.
When a good is easily substituted, Price Elasticity of Demand is elastic or inelastic?
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22.
When a good is hardly substituted, Price Elasticity of Demand is elastic or inelastic?
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23.
What is a necessity?
Type the Question that corresponds to the displayed Answer.
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24.
Where the demand and supply curves intersect. It is symbolized by P* and Q*
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25.
The quantity of a good I'm willing to sell for all prices
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26.
The maximum value I'm willing to pay for a good
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27.
Goverment policy instrument used to raise revenue for public projects and to redistribute income
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28.
The price of a good compared to the price of other good. (With the same money, what ratio of good 1 can you buy compared to good 2). I.E.: 1kg bread-2€/1kg meat-10€ Relative price of bread-meat is 0,2. With 2€ you can buy 1kg of bread or 0,2 kg of meat.
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29.
Demand slope is always negative.
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30.
The quantity of a good I'm willing to buy for all prices

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