5 Steps to a 5 AP Microeconomics, 2014-2015 Edition

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‹ 41 Fundamentals of Economic Analysis IN THIS CHAPTER Summary:If there are two concepts that you should have down pat, they are ...

5.1 Scarce Resources Main Topics: Economic Resources, Scarcity, Trade-Offs, Opportunity Cost, Marginal Analysis Economic Resourc ...

night. A steel company must decide whether to open a steel plant in Indiana or Indonesia. Governments Every society, in one form ...

Marginal Analysis Most decisions are made based upon a change in the status quo. You have one cup of coffee (the status quo) and ...

You will find this to be true in consumption, production, hiring, and many other eco- nomic decisions. 5.2 Production Possibilit ...

46 › Step 4. Review the Knowledge You Need to Score High We can graphically depict Table 5.1 in a production possibility curve. ...

Fundamentals of Economic Analysis ‹ 47 The same could be said for individual laborers. Maybe the entrepreneur herself was traine ...

48 › Step 4. Review the Knowledge You Need to Score High Because the bakery can produce more pastries than the pizza parlor, the ...

Fundamentals of Economic Analysis ‹ 49 economy is operating at some point on the frontier, who is to say that it is the point th ...

50 › Step 4. Review the Knowledge You Need to Score High The allocatively efficient amount of pizza crusts is Q*, the quantity w ...

Fundamentals of Economic Analysis ‹ 51 5.3 Functions of Economic Systems Main Topic: Market Systems Market Systems In the twenty ...

52 › Step 4. Review the Knowledge You Need to Score High are most willing and able to pay those prices. Prices coordinate the de ...

Fundamentals of Economic Analysis ‹ 53 Ray and Dorothy can both cook and can both pull weeds in the garden on a Saturday aftern ...

Opportunity cost:The value of the sacrifice made to pursue a course of action. Marginal:The next unit or increment of an action. ...

Demand, Supply, Market Equilibrium, and Welfare Analysis IN THIS CHAPTER Summary:A thorough understanding of the way in which th ...

scenes” of demand. Intuition will take you only so far: you need to know the underlying theory of what is perhaps the most widel ...

Today at the price of $1, the relative cost of a fritter is one-half of a bagel (see Table 6.1). Relative to your income, it amo ...

Quantity Demanded Versus Demand The law of demand predicts a downward- (or negative) sloping demand curve (Figure 6.1). If the p ...

An increase in demandis viewed as a rightward shiftin the demand curve. There are two ways to think about this shift. a. At all ...