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13 Cards in this Set

  • Front
  • Back
What are the core questions in economics?
What to produce?
How to produce it?
For whom to produce it?
What are the major factors of production?
Resource inputs used to produce goods and services
Four Types:
Land
Labor
Capital
Entrepreneurship
Define and Explain Opportunity cost?
The next most desired goods and services foregone to obtain something else

"Giving up one asset or resource in order to produce another"
Define an economy's production possibilities.
The alternative combinations of final goods and services that could be produced in a given time period with all available resources and technology
Illustrate the concept of Opp. Cost using a production possibilities diagram.
What are the implications of Scarcity?
Lack of enough resources to satisfy all desired uses of those resources

"limit to economic output"
Why do Opp cost increase with greater production.
Difficulty shift resources and different mixes/ intensities of resources.
Define inefficiency and efficiency.
Efficiency: Maximum output of a good from the resources used in production

Inefficiency: a sub optimal combination of output <100%
Illustrate efficiency and inefficiency.
Define Economic Growth and economic decline.
Econ Growth: Is an increase in production possibilities due to increases in resources.

Econ decline: Is an decrease in production possibilities due to disease, natural disasters, war.
Illustrate economic growth/
What are the major topics and perspectives within microeconomics?
The study of individual behavior in the economy
-"Markets" Supply and Demand
-Resources
-Individual pricing
What are the major topics and perspectives withing macroeconomics?
The study of aggregate economic behavior, of the economy as a whole.
- National Production
- GDP
-Unemployment
- National Income