AP Economics Final Exam Study Sheet
Krugman Text 2018- Mace 2023 Update
Microeconomics deals with - ANS-individuals, housing, and individual firm
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Macroeconomics deals with - ANS-the economy as a whole rather than the individual
markets, including national, regional, and global economies
Too little spending in an economy often leads to - ANS-recession
Scarcity in economics means - ANS-not having sufficient resources to produce all the
goods and services we want
The short-run alternation between economic downturns, recessions, and economic
upturns and expansions is known as the - ANS-business cycle
Inflation is a situation where - ANS-price levels increase and the value of money
decreases
Use the "Consumer and Capital Goods" Figure 3-3. The movement from Curve 1 to
curve 2 indicates - ANS-economic growth
Use the "Consumer and Capital Goods" Figure 3-3. Point Z - ANS-unattainable at that
time
Gains from trade arise because of - ANS-specialization in production
Use the "Alphaland and Omegaland" Figure 4-4. The opportunity cost of producing 1
tire in Alphaland is ½ radio(s), while the opportunity cost of producing 1 tire in
Omegaland is - ANS-2 radio(s)
Which of the following factors cause a movement along the demand curve? - ANSChange in price of the good
If goods A and B are substitutes, a decrease in the price of good B will - ANS-decrease
the demand for good A
Use the "Demand for Coconuts" Figure 5-1. If coconuts are considered a normal good
and the overall income level of consumers is falling, then the movement that would take
place in the model could be - ANS-E-B
A direct relationship between price and quantity is represented by - ANS-the supply
curve
Use Table 6-1. If the price of lemonade is $1 per cup, total quantity of lemonade
supplied will be - ANS-40 cups
Use the "DVD Market" Figure 6-2. At a rental price of $6, there will be - ANS-40 DVDs
per weekend
Use the "Supply and Demand in the Orange Juice Market" Figure 7-3. Assume that a
hurricane hits Florida. In response, what would be the most likely equilibrium point in the
orange juice market illustrated? - ANS-point A
In the soft drink market, an increase in the price of sugar, a necessary ingredient for soft
drinks, and an increased concern about tooth decay caused by the consumption of soft
drinks will result in which of the following?...
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