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ECONOMY by Mind Map: ECONOMY

1. Microeconomy

2. Macroeconomy

2.1. Introduction

2.1.1. 4 factors of Production

2.1.2. Production Possibilities

2.1.3. Mechanisms of choice

2.1.4. The US economy

2.1.4.1. What

2.1.4.2. How

2.1.4.3. For Whom

2.2. Supply and Demand

2.2.1. The Circular Flow

2.2.2. Demand

2.2.3. Supply

2.2.4. Equilibrium

2.3. Public Sector

2.3.1. What causes Market Failure

2.3.1.1. Public goods

2.3.1.2. Externalities

2.3.1.3. Market power

2.3.1.4. Inequity

2.3.2. Growth of government

2.3.3. Evaluation of public services

2.4. National Income Accounting

2.4.1. Measures of output

2.4.1.1. Non-market activities

2.4.1.2. Unreported Income

2.4.1.3. Value added

2.4.2. Uses of output

2.4.3. Measures of Income

2.4.4. Flow of income

2.5. Unemployment

2.5.1. Labor Force

2.5.2. Measuring unemployment

2.5.3. Full employment

2.6. Inflation

2.6.1. Consequences

2.6.2. Measuring inflation

2.6.3. Price stability

2.6.4. Causes

2.6.5. Real interest rate

3. CHAPTER 1

3.1. SUNK COST

3.2. NORMATIVE VS POSITIVE

3.3. SHIFT IN S/D

3.4. TOTAL SURPLUS

3.4.1. NO CASH ON THE TABLE

3.4.2. EFFICIENCY PRINCIPLE

3.4.3. EQUILIBRIUM PRINCIPLE

3.5. 3 SITUATION WHERE HOUSE PRICE INCREASE AND QUANTITY UNCHANGED

3.6. MAXIMIZE YOUR AVERAGE GRADE

4. CHAPTER 2

4.1. PRICE ELASTICITY OF DEMAND

4.1.1. DETERMINANTS

4.1.2. GRAPHICAL

4.1.3. CROSS-PRICE ELASTICITY OF DEMAND

4.1.4. INCOME ELASTICITY OF DEMAND

4.2. PRICE ELASTICITY OF SUPPLY

4.2.1. DETERMINANTS

4.2.2. PERFECT

4.3. MIDPOINT FORMULA

4.4. MARGINAL UTILITY

4.4.1. DIMINISHING MARGINAL UTILITY

4.4.2. RATIONAL SPENDING RULE

4.4.2.1. ICE CREAM

4.5. INDIVIDUAL VS MARKET

5. CHAPTER 3

5.1. PERFECTLY COMPETITIVE FIRM

5.1.1. 4

5.1.2. GRAPH

5.2. SHORT VS LONG RUN

5.3. LAW OF DIMINISHING RETURNS

5.4. SHUT DOWN DECISIONS

5.5. COST CURVES

5.5.1. PROFIT VS LOSS

5.5.2. ACCOUNTING PROFITS; ECONOMIC PROFITS; NORMAL PROFITS

5.5.2.1. KIMCHI

5.6. 2 FUNCTIONS OF PRICE

5.7. THE CYCLE

5.7.1. BARRIER ENTRY

5.7.2. INNOVATIONS

5.8. PRICE CEILING

5.8.1. OIL EXAMPLE

5.9. PRICE SUBSIDIES

5.9.1. BREAD EXAMPLE

6. E = % deltaQ/Q  /  % deltaP/P

7. E = P/Q  x   1/slope

8. E = % change in quantity  /   %change in income

9. E = %change in A demand /  %change in price B

10. Midpoint formula for E = deltaQ / [(QA+QB)/2]  /  deltaP/[PA+PB)/2]

11. MUc/Pc   = MUv/Pv

12. P x Q   <   VC        =           P< AVC                           SHUTDOWN

13. P x Q > ATC x Q   =   P   > ATC

14. Profit = (P - ATC) x Q

15. PROFIT MAXIMIZING QUANTITY =     P=MC  price of bat is 10$, find where marginal cost < 10$                    Revenue = Profit - TC                          Tax 2$ per bat = add directly onto MC

16. P > ATC     POSITIVE ECON PROFIT        P = ATC    ZERON ECON/NORMAL        P < ATC & > AVC  = LOSS                    P < AVC   = SHUTDOWN

17. AS DEMAND INCREASES, P=MC=MR  > ATC BUT EVENTUALLY SUPPLIES INCREASE AND DEMAND DECREASE TO REACH OPTIMAL LEVEL WHERE P=MC=MR=ATC

18. TAX ON SUPPLY GRAPH ; CONSUMER SURPLUS PRODUCER SURPLUS; TAX REDISTRIBUTION

19. CHAPTER 4

19.1. IMPERFECT COMPETITION

19.1.1. MONOPOLY

19.1.2. MONOPOLISTIC

19.1.3. OLIGOPOLY

19.2. MARKET POWER

19.2.1. INPUT

19.2.2. PATENTS & COPYRIGHT

19.2.3. LICENSES & FRANCHISES

19.2.4. NATURAL MONOPOLIES (ECONOMIES OF SCALE)

19.2.4.1. INCREASING RETURNS TO SCALE

19.2.4.2. HIGH FIXED COST & LOW MARGINAL COST

19.2.5. NETWORK ECONOMIES

19.3. PRICE DISCRIMINATION

19.3.1. CARLA

19.3.1.1. SOCIAL OPTIMUM

19.3.1.2. MR OR SINGLE PRICE

19.3.1.3. PRICE DDISCRIMINATOR

19.3.1.4. HURDLE METHOD

19.4. GAME THEORY

19.4.1. SYMMETRIC PAYOFF

19.4.2. NONSYMMETRIC PAYOFF

19.4.3. NASH EQUILIBRIUM

19.4.3.1. SIMULTANEOUS DECISIONS

19.4.4. PRISONER'S DILEMMA

19.4.5. CARTEL

19.4.6. REPEATED PRISONERS DILEMMA                       TIT FOR TAT

20. TC = F + M*Q

21. ATC = F/Q + M  ; ATC Decreases as output increases

22. P > MR   P > MC                                     PROFIT MAXIMIZING  MC=MR              MAX SURPLUS  MC=MB (OR PRICE)

23. MR = QX2 USING PRICE FUNCTION

24. LEMONADE CALCULATIONS

24.1. PROFIT MAXIMIZING

24.2. MAX SURPLUS

24.3. PRICE DISCRIMINATOR

25. CHAPTER 5

25.1. EXTERNALITIES

25.1.1. TAXING NEGATIVE

25.1.2. SUBSIDIZE POSITIVE

25.2. ABERCROMBIE POLLUTER

25.2.1. NO COMMUNICATION

25.2.2. COMMUNICATION

25.2.2.1. COARSE THEOREM

25.2.3. LET IT POLLUTE

25.3. SHARED LIVING

25.4. TRAGEDY OF COMMONS

25.5. EBAY VS NEWSPAPER

25.6. RATIONAL SEARCH GUIDELINES

25.6.1. EXPECTED VALUE OF GAMBLE

25.6.1.1. FAIR GAMBLE

25.6.1.2. BETTER THAN FAIR GAMBLE

25.6.1.3. RISK NEUTRAL; AVERSE; SEEKING

25.6.2. COMMITMENT PROBLEMS AND SEARCH

25.6.3. ASYMMETRIC INFORMATION

25.6.3.1. AKARI VS HARUTO

25.6.3.2. LEMONS MODEL

25.6.3.2.1. CREDIBILITY PROBLEM

25.6.3.2.2. COSTLY TO FAKE PRINCIPLE

25.7. STATISTICAL DISCRIMINATION

25.8. ADVERSE SELECTION

25.9. MORAL HAZARD

26. BOOMBOX CALCULATIONS

27. EDUCATION

28. SEAN OPERATION

29. CARLOS

30. CHAPTER 6

30.1. HEALTHCARE FOR THE EMPLOYED

30.2. COST VS BENEFITS??

30.3. DAVID HOSPITAL STAY

30.3.1. FIRST DOLLAR COVERAGE VS 1000 DEDUCTICBLE

30.4. POLLUTION

30.4.1. REDUCE

30.4.1.1. TAX REDUCTION

30.4.1.2. PERMITS

30.4.1.2.1. ADVANTAGES

30.5. SAFETY STANDARDS

30.6. GOODS

30.6.1. PUBLIC GOOD

30.6.1.1. NON RIVAL

30.6.1.2. NONEXCLUDABLE

30.6.2. PRIVATE GOOD

30.6.3. COLLECTIVE GOOD

30.6.4. PURE COMMON GOODS

30.7. PAYING FOR PUBLIC GOOD

30.7.1. SHARING COST

30.7.2. HEAD TAX/REGRESSIVE TAX

30.7.3. PROPORTIONAL INCOME TAX

30.8. VERTICAL SUMMATION

30.9. ADVERTISING

30.9.1. LOSS SURPLUS

30.10. RENT SEEKING

30.11. CROWDING OUT

30.11.1. ADDING TAXES

31. BOTOX INJECTION

32. NEIGHBOR MUSIC

33. KOI POND

34. VERTICAL SUMMATION

35. CHAPTER 7

35.1. GDP CALCULATIONS

35.1.1. FINAL GOODS AND SERVICES

35.1.1.1. VALUE ADDED

35.1.1.2. DOMESTIC

35.1.2. TOTAL SPENDING

35.1.2.1. CONSUMPTION

35.1.2.2. INVESTMENT

35.1.2.3. GOVERNMENT PURCHASES

35.1.2.4. NET EXPORTS

35.1.3. INCOME

35.1.3.1. LABOR INCOME

35.1.3.1.1. WAGES SALARIES BENEFITS

35.1.3.2. CAPITAL INCOME

35.1.3.2.1. PROFITS FOR BUSINESS RENT ROYALTIES BOND INTEREST

35.1.4. REAL VS NOMINAL GDP

35.1.5. ECONOMIC WELL BEING

35.2. INFLATIONS

35.2.1. CPI

35.2.1.1. INDEXING

35.2.1.1.1. BRACKET CREEP

35.2.1.1.2. INVESTMENT TAX

35.2.1.2. QUALITY ADJUSTMENT BIAS

35.2.1.3. SUBSTITUTION BIAS

35.2.1.4. NOISY PRICES

35.2.2. SHOE LEATHER AND MENU COST

35.2.3. REAL INTEREST RATE

35.2.3.1. FISHER EFFECT