Microeconomics
vorbereitung klausur wintersemester 2016
vorbereitung klausur wintersemester 2016
Kartei Details
| Karten | 104 |
|---|---|
| Sprache | English |
| Kategorie | BWL |
| Stufe | Universität |
| Erstellt / Aktualisiert | 03.01.2017 / 01.01.2018 |
| Weblink |
https://card2brain.ch/box/20170103_microeconomics
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when do changes in equilibrium appear?
when supply and demand curves shift
2 main functions of the price mechanism?
distributing scarce goods and services to consumers, allocation of resources among producers
def price rationing
the adjustment of price is the rationing mechanism in free markets. Price rationing means that whenever there is a need to ration a goods the price of the good will rise until quantity supplied equals quantity demanded
examples for market contraints
minimum wages and maximum price for rents
possible reasons for market constraints
income is unfairly distributed, some items are necessities, price is going bad
def market constraints
attempts to bypass price rationing in the market and to use alternative rationing devices are more difficult and more costly than they would seem at first glance
price ceiling / floor
can create excess demand
problem of minimum wage
leads to excess supply
problem with demand for wokers with minimum wage
demand will be minimised because the higher price leads to fewer jobs
alternative rationing mechanisms
queuing, favoured customers, ration coupons and black market
def consumer surplus
difference between the maximum amount a person is willing to pay for a good and its current market price
def producer surplus
the difference between the current market price and the cost of production for the firm
what is total welfare?
the sum of consumer and producer surplus
what maximises the sum of producer and consumer surplus?
competitive markets
def deadweight loss
the total loss of producer and consumer surplus from underproduction or overproduction
Def Opportunity Costs
The cost of the best alternative that we forgo, or give up, when we make a choice or a decision
Def Marginalism
The process of analysing the additional or incremental costs or benefits arising from a choice or decision
Def Efficient Markets
A market in which profit opportunities are eliminated almost instantaneously
Two Types of Needs
material things and services versus immaterial things
two types of goods
consumer goods versus capital goods
opposite scarce goods
free goods
what information does the price of a scarce good give?
level of scarcity
two types of prices?
nominal price versus real price
what is a real price?
adjusted for inflation
how do you measure a real price?
by CPI or PPI
Formula Real price 2014 in 1985 prices
CPI 1985 / CPI 2014 * nominal price in 2014
Formula Percentage change in real price 2014 & 1985
real price in 2014 - real price in 1985 / real price in 1985
Markets are a place... (3)
... where buyers and sellers of certain goods meet ... where a price for the goods is determined through their interactions ... that might be physical or virtual
characteristics perfectly competitive market
many buyers and sellers
no single buyer or seller has impact on price
characteristics of non-competitive markets
even if many producers
firms jointly affect price
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