AP Micro Final

What does MRDARP stand for?

Marginal Revenue = Demand = Average Revenue = Price

What is Jacob Clifford's favorite band?

ACDC

What is unique about a marginal cost curve shape?

nike swoosh/checkmark/U shape

What is the profit maximizing formula for all firms when setting output?

MR=MC

what vehicle has the wheels go round and round

school bus

Who is confronted by the problem of scarcity?

everyone

What is oppurtunity cost?

the loss of potential gain from other alternatives when one alternative is chosen.

what does the law of demand state about price and quantity?

inverse relationship between price and quantity

what makes a good inferior?

income goes up, demand goes down (Fast Food)

how does the change in price affect a complementary good when it changes?

Increase in price, Decrease in demand

what is the equation for profit?

Profit = Total Revenue - Total Cost

If looking at a table of total labor of each worker, how do you find marginal product?

change in quantity of output/change in \# of workers

how do you find the marginal cost on a table from 1 unit to 2?

change in total cost/change in quantity of output

what is the shut-down rule?

a firm should shut down if the price falls below the minimum ATC

how do you compute total value when when given price and quantity?

price x quantity=total value

if you have two people in the classic prisoner's dilemma, and they have a choice to not confess or to confess, what is their dominant strategy?

nash equilibrium

what type of profits will a monopoly make in the long run?

economic profit

Why is factor demand called derived demand?

It results or is derived from the demand for the output being produced.

when given a bunch of choice of things to do, and you have to pick one thing over the others. What is it called? (not opportunity cost, that is the next best alternative)

trade-offs (??)

the formula for comparative advantage

quantity of good A/Quantity of good B

why do we have to make choices?

scarcity

if you pay kids to get good grades, what is that economic concept called?

incentive