By the end of this section, you will be able to:

Interpret production possibilities frontier graphs
Contrast a budget constraint and a production possibilities frontier
Explain the relationship between a production possibilities frontier and the law of diminishing returns
Contrast productive efficiency and allocative efficiency
Define comparative advantage

By the end of this section, you will be able to:
Contrast consumer surplus, producer surplus, and social surplus
Explain why price floors and price ceilings can be inefficient
Analyze demand and supply as a social adjustment mechanism

By the end of this section, you will be able to:

Explain demand, quantity demanded, and the law of demand
Identify a demand curve and a supply curve
Explain supply, quantity supplied, and the law of supply
Explain equilibrium, equilibrium price, and equilibrium quantity

By the end of this section, you will be able to:

Explain price controls, price ceilings, and price floors
Analyze demand and supply as a social adjustment mechanism

By the end of this section, you will be able to:

Identify factors that affect demand
Graph demand curves and demand shifts
Identify factors that affect supply
Graph supply curves and supply shifts

By the end of this section, you will be able to:

Discuss the components of economic growth, including physical capital, human capital, and technology
Explain capital deepening and its significance
Analyze the methods employed in economic growth accounting studies
Identify factors that contribute to a healthy climate for economic growth

By the end of this section, you will be able to:

Explain economic convergence
Analyze various arguments for and against economic convergence
Evaluate the speed of economic convergence between high-income countries and the rest of the world

By the end of this section, you will be able to:

Identify the role of labor productivity in promoting economic growth
Analyze the sources of economic growth using the aggregate production function
Measure an economy’s rate of productivity growth
Evaluate the power of sustained growth

By the end of this section, you will be able to:

Analyze how price elasticities impact revenue
Evaluate how elasticity can cause shifts in demand and supply
Predict how the long-run and short-run impacts of elasticity affect equilibrium
Explain how the elasticity of demand and supply determine the incidence of a tax on buyers and sellers

By the end of this section, you will be able to:

Calculate the income elasticity of demand and the cross-price elasticity of demand
Calculate the elasticity in labor and financial capital markets through an understanding of the elasticity of labor supply and the elasticity of savings
Apply concepts of price elasticity to real-world situations

By the end of this section, you will be able to:

Differentiate between infinite and zero elasticity
Analyze graphs in order to classify elasticity as constant unitary, infinite, or zero

By the end of this section, you will be able to:

Calculate the price elasticity of demand
Calculate the price elasticity of supply

By the end of this section, you will be able to:

Differentiate among a floating exchange rate, a soft peg, a hard peg, and a merged currency
Identify the tradeoffs that come with a floating exchange rate, a soft peg, a hard peg, and a merged currency