Economics Advanced but overall

• Who is the presenter of the ACDC econ summary video?

  Jacob Clifford
• What is the purpose of the ACDC econ summary video?


  To help students prepare for an AP or college introductory microeconomics class
• How can watching the summary video help students before the AP test?


  It allows them to spot areas they need to study further
• What does Jacob Clifford sell to help students learn economics?


  The ultimate review pack
• What is the concept of scarcity in economics?


  It refers to unlimited wants and limited resources
• What does opportunity cost mean?


  It means that every decision has a cost associated with it
• What is the production possibilities curve?


  It shows different combinations of producing two goods using all resources
• What does a point on the production possibilities curve represent?


  An efficient use of all resources
• What does a point inside the production possibilities curve indicate?


  An inefficient use of resources
• What does a point outside the production possibilities curve represent?


  A level of production that is impossible with current resources
• What does a straight line production possibilities curve indicate?


  Constant opportunity cost
• What does a concave production possibilities curve indicate?


  Increasing opportunity cost
• What can shift the production possibilities curve?


  Changes in resources, technology, or trade
• What is comparative advantage?


  It is the idea that a country should specialize in producing goods with lower opportunity costs
• What is absolute advantage?


  It refers to the ability to produce more of a good than another producer
• What are terms of trade?


  They define how many units of one product should be traded for another
• What are the different economic systems mentioned?

  Free market system, capitalism, command economy, and mixed economy
• What does the circular flow model illustrate?


  Interactions between businesses, individuals, and the government
• What are transfer payments?


  Payments made by the government to individuals without a purchase requirement
• What are subsidies?


  Government payments to businesses to encourage production
• What are factor payments?


  Payments made by businesses to individuals for their resources
• What is the difficulty level of Unit 1 in economics according to Jacob Clifford?


  About a three out of ten
• What is the law of demand?


  When price goes up, quantity demanded goes down
• What are the three reasons for the downward slope of the demand curve?

  Substitution effect, income effect, and law of diminishing marginal utility
• What is the law of supply?


  When price goes up, quantity supplied goes up
• What happens when there is a shortage in the market?


  Price tends to rise
• What happens when there is a surplus in the market?


  Price tends to fall
• What is the double shift rule in economics?


  When two curves shift simultaneously, one variable becomes indeterminate
• What are substitutes in economics?


  Products that can be used in place of each other
• What are complements in economics?


  Products that are typically bought together
• What are normal goods?


  Goods for which demand increases as income increases
• What are inferior goods?


  Goods for which demand decreases as income increases
• What does elasticity measure in economics?


  How quantity demanded changes in response to price changes
• What does an elastic demand curve look like?


  Quantity is very sensitive to price changes
• What does an inelastic demand curve look like?


  Quantity is not sensitive to price changes
• What is the elasticity of demand coefficient?


  It is the percent change in quantity divided by the percent change in price
• What does a coefficient greater than one indicate?


  Elastic demand
• What does a coefficient less than one indicate?


  Inelastic demand
• What is cross-price elasticity?


  It measures the percent change in quantity of one product relative to the percent change in price of another product
• What does a positive cross-price elasticity indicate?


  That the products are substitutes