Macro Learning Objectives for questions over Exam 1 Form A

 

FALL/SPRING/SUMMER

PCM

 ECON 2302 MICROECONOMICS   

Chapter 2

Below you will find the learning objective, concept, idea, term, or theory that each question on the exam will cover. The numbers in the list refer to the question number on Exam 1 that will test your knowledge of that specific learning objective. You will also find a reference to the page numbers in the textbook, Microeconomics, Explore & Apply: Activebook Version 2.0 where the substance of each question is explained. A much better understanding can often be attained by working through the "active graphs" and "smart graphs" connected to many of these objectives in the online material.

 

  After reading this chapter, you should be able to:

  1. Define fully what is meant by land, labor, capital, human capital, entrepreneurship, and technology. Pages 16-17
  2. Explain what is meant by opportunity cost. Page 16
  3. Draw a production possibilities frontier, to explain its shape and meaning, and to discuss how opportunity cost (both total and marginal) can be illustrated with it. Pages 17-19
  4. Explain what is meant by the law of increasing cost, be prepared to also be able explain why it exists (and concurrently why the production possibilities frontier is bowed out from the origin). Page 18
  5. Show how a production possibilities frontier can be used to illustrate efficiency, inefficiency, and scarcity (impossible combinations of output). Page 19
  6. Show how a production possibilities frontier can be used to illustrate economic growth and technological change, even if the technological change is specialized. Pages 20-23
  7. Explain and draw the simple modal of the Circular Flow of Economic Activity labeling its markets, actors, and money flows. Page 25
  8. Define the difference between absolute advantage and comparative advantage and explain which one is more important as a basis for specialization and trade. Pages 26-28
  9. Be able to compute absolute and comparative advantage from numerical examples and to tell from such computations which country should specialize in which product. Page 28
  10. Convey how economic growth and the strength it provides can lead to victory in international conflicts. Pages 28-31