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20 Cards in this Set
- Front
- Back
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Allocative efficiency |
Production is in accordance with consumer preferences |
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Productive efficiency |
When a good or service is produced at the lowest possible cost |
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Centrally Planned Economy |
The government decides how economic resources will be allocated. |
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Economic model |
Model of irl economic situations |
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Economic Variable |
Measurable that can have different values |
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Economics |
Study of choices consumers, business managers, and government officials make to attain their goals, given their scarce resources |
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Equity |
Equally distribution of economic benefits |
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Macroeconomics |
Study of the economy as a whole |
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Microeconomics |
Study of individuals such as households and firms |
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Marginal Analysis |
Involved comparing marginal benefits and marginal costs |
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Market |
Group of buyers and sellers of a good or trade |
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Market economy |
Decisions of households and firms interacting in markets allocate economic resources |
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Mixed Economy |
Involves a wide, world-wide scale |
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Normative Analysis |
Concerned with what ought to be |
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Opportunity Cost |
Highest-valued alternative that must be given up to engage in said activity |
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Positive analysis |
Concerned with what is |
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Productive efficiency |
Occurs when a good or service is produced at the lowest possible cost |
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Scarcity |
Our wants are unlimited but our resources are limited |
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Trade-offs |
Producing more of one good or service means producing less of another good or service |
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Voluntary Exchange |
Both buyer and seller of a product are made better off by the transaction |
