UNC-Chapel Hill ECON 101 - 3. August 26 (3 pages)

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3. August 26



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3. August 26

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Pages:
3
School:
University of North Carolina at Chapel Hill
Course:
Econ 101 - Introduction to Economics

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Washburn 3 August 26 2014 Econ 101 Turchi o Product Possibilities Frontier o The PPF can move in if an event causes the inputs for the product to be lessened or destroyed o If inside the frontier instead of on the line the economy in not fully efficient o Moving from A to B has no opportunity cost because nothing is lost Efficiency A o B Two sides of the market o Demand o Desire does not equal demand o Demand is desire coupled with the ability to pay o Demand units are per o Month o Year o Week o What determines demand o Taste or preferences o Fashion o Size of population o Income of the average household Expected income o Distribution of Income among household o Price of the commodity in question o Price expectations o Price of other commodities o Competition o Goods in tandem impact prices o Peanut butter price goes up demand for jelly decreases o 3 Product Relationships o Substitutes Washburn o o o Complements o Unrelated Q F T POP I DI P PA PE Ceteris Paribas Cumquat Demand Curve for Cumquats 140 Price of Cumquats 120 100 80 60 40 20 0 60 70 80 90 100 110 120 1000 s of Tons demanded per month o o o o o As price goes up demand goes down Any movement along a stationary demand curve is called a change in quantity demanded Any shift in the demand curve is called a change in demand A change in demand involves a change in one of the other typically stationary values Often just price quantity combinations are available o The other factors of the market are often not available to economists Different types of goods as they relate to income Quantity Normal Necessity Inferior Income o Supply o Supply Determinants o Goals of the firm o State of technology o Price of the commodity o Price of other commodities o o o o o o o o o o o o o o Washburn o Input prices



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