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13 Cards in this Set
- Front
- Back
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economics
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allocation of unlimited wants but limited resources
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opportunity cost
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the highest valued alternative forgone (what you gave up)
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marginal cost
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the OC of producing one more unit of a good
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marginal benefit
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benefit received from consuming one more unit of a good
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comparative advantage
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an advantage in an activity if a person can perform the activity at a lower opportunity cost than others
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Law of Demand
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as the price of a good increases, the quantity demanded of a good will decrease
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quantity supplied
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the amount that firms plan to sell during a given time period at a specific price
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Law of Supply
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the higher price of a good, the greater the quantity supplied
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elasticity
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"responsiveness"
-units free measure of the responsiveness of the quantity demanded of a good to a change in its price when all other influences on buyer's plans remain the same |
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total revenue
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equal to the price of the good times the quantity sold
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consumer surplus
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the value of the good minus the price paid for it over the quantity bought
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producer surplus
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the price of a good minus the opportunity cost of producing it, summed over the quantity sold
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total surplus
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the sum of consumer surplus and producer surplus
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