Macro Learning Objectives for questions over Exam 2 Chapter 7

 

FALL/SPRING/SUMMER

PCM

 ECON 2302 MICROECONOMICS   

Chapter 7

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 2 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. Identify the three legal forms of business and the advantages and disadvantages of each. Pages 106-107
  2. Explain the different methods available to help finance a business. Pages 107-108
  3. Explain what motivates business firms in the economic model presented in the textbook. Page 108
  4. Define explicit opportunity cost and implicit opportunity cost and explain the difference between them. Page 109
  5. Define Accounting Profit and Economic Profit and explain the difference between them. Page 109
  6. Distinguish between Normal Profit, Above Normal Profits/excess profits, Below Normal Profits, losses, and breakeven earnings. Pages 109-110
  7. Discuss the principal-agent problem and the various attempts to solve it. Page 111
  8. Define what a production function is and distinguish between the Long Run and the Short Run. Page 111-112
  9. Define, in the context of the production function, Total Product, Average Product, Marginal Product, and the Law of Diminishing Returns. Pages 112-114
  10. Discuss the conflict, if any, between self-interest and acting ethically in the business world. Pages 115-116