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57 Cards in this Set
- Front
- Back
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ECONOMICS |
THE STUDY OF HOW SOCIETY MANAGES ITS SCARCE RESOURCES |
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EFFICIENCY |
THE PROPERTY OF SOCIETY GETTING THE MOST IT CAN FROM ITS SCARCE RESOURCES |
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EQUITY |
THE PROPERTY OF DISTRIBUTING ECONOMIC PROSPERITY FAIRLY AMONG THE MEMBERS OF SOCIETY |
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OPPORTUNITY COST |
WHATEVER MUST BE GIVEN UP TO OBTAIN SOME ITEM |
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RATIONAL PEOPLE |
PEOPLE WHO SYSTEMATICALLY AND PURPOSEFULLY DO THE BEST THEY CAN TO ACHIEVE THEIR OBJECTIVES |
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MARGINAL CHANGES |
SMALL INCREMENTAL ADJUSTMENTS TO A PLAN OF ACTION |
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INCENTIVE |
SOMETHING THAT INDUCES A PERSON TO ACT |
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MARKET ECONOMY |
AN ECONOMY THAT ALLOCATES RESOURCES THROUGH THE DECENTRALIZED DECISIONS OF MANY FIRMS AND HOUSEHOLDS AS THEY INTERACT IN MARKETS FOR GOODS AND SERVICES |
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MARKET FAILURE |
A SITUATION IN WHICH A MARKET LEFT ON ITS OWN FAILS TO ALLOCATE RESOURCES EFFICIENTLY |
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EXTERNALITY |
THE IMPACT OF ONE PERSONS ACTIONS ON THE WELL BEING OF A BYSTANDER |
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PRODUCTIVITY |
THE QUANTITY OF GOODS AND SERVICES PRODUCED FROM EACH HOUR OF A WORKERS TIME |
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INFLATION |
AN INCREASE IN THE OVERALL LEVEL OF PRICES IN THE ECONOMY |
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PPF |
A GRAPH THAT SHOWS THE COMBINATIONS OF OUTPUT THAT THE ECONOMY CAN POSSIBLE PRODUCE |
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MICROECONOMICS |
THE STUDY OF HOW HOUSEHOLDS AND FIRMS MAKE DECISIONS AND HOW THEY INTERACT IN MARKETS |
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MACROECONOMICS |
THE STUDY OF ECONOMY WIDE PHENOMENA, INCLUDING INFLATION, UNEMPLOYMENT, AND ECONOMIC GROWTH |
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POSITIVE STATEMENTS |
DESCRIBE THE WORLD AS IT IS |
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NORMATIVE STATEMENTS |
PRESCRIBE HOW THE WORLD SHOULD BE |
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ABSOLUTE ADVANTAGE |
THE COMPARISON OF GOODS ACCORDING TO THEIR PRODUCTIVITY |
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COMPARATIVE ADVANTAGE |
THE COMPARISON OF GOODS ACCORDING TO THEIR OPPORTUNITY COST |
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IMPORTS |
GOODS AND SERVICES PRODUCED ABROAD AND SOLD DOMESTICALLY |
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EXPORTS |
GOODS AND SERVICES PRODUCED DOMESTICALLY AND SOLD ABROAD |
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MARKET |
A GROUP OF BUYERS AND SELLERS OF A PARTICULAR GOOD OR SERVICE |
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COMPETITIVE MARKET |
A MARKET WHERE THERE ARE MANY BUYERS AND SELLERS SO THAT EACH HAS A NEGLIGIBLE IMPACT ON THE MARKET PRICE |
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QUANTITY DEMANDED |
THE AMOUNT OF A GOOD THAT BUYERS ARE WILLING ABLE TO PURCHASE |
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LAW OF DEMAND |
THE QUANTITY DEMANDED OF A GOOD FALLS WHEN THE PRICE OF THE GOOD RISES |
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DEMAND SCHEDULE |
A TABLE THAT SHOWS THE RELATIONSHIP BETWEEN THE PRICE OF A GOOD AND THE QUANTITY DEMANDED |
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DEMAND CURVE |
A GRAPH OF THE RELATIONSHIP BETWEEN THE PRICE OF A GOOD AND QUANTITY DEMANDED |
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NORMAL GOOD |
AN INCREASE IN INCOME LEADS TO AN INCREASE IN DEMAND |
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INFERIOR GOOD |
AN INCREASE IN INCOME LEADS TO A DECREASE IN DEMAND |
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SUBSTITUTES |
TWO GOODS FOR WHICH AN INCREASE IN THE PRICE OF ONE LEADS TO AN INCREASE IN THE DEMAND FOR THE OTHER |
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QUANTITY SUPPLIED |
THE AMOUNT OF A GOOD THAT SELLERS ARE WILLING AND ABLE TO SELL |
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LAW OF SUPPLY |
THE QUANTITY SUPPLIED OF A GOOD RISES WHEN THE PRICE OF THE GOOD RISES |
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SUPPLY SCHEDULE |
A TABLE THAT SHOWS THE RELATIONSHIP BETWEEN THE PRICE OF A GOOD AND THE QUANTITY SUPPLIED |
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SUPPLY CURVE |
A GRAPH OF THE RELATIONSHIP BETWEEN THE PRICE OF A GOOD AND THE QUANTITY SUPPLIED |
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EQUILIBRIUM |
PRICE HAS REACHED THE LEVEL WHERE QUANTITY SUPPLIED = QUANTITY DEMANDED |
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SURPLUS |
THE QUANTITY SUPPLIED IS GREATER THAN THE QUANTITY DEMANDED |
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SHORTAGE |
QUANTITY DEMANDED IS GREATER THAT QUANTITY SUPPLIED |
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LAW OF SUPPLY AND DEMAND |
THE PRICE OF ANY GOOD ADJUSTS TO BRING THE QUANTITY SUPPLIED AND THE QUANTITY DEMANDED FOR THAT GOOD INTO BALANCE |
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ELASTICITY |
A MEASURE OF THE RESPONSIVENESS OF QUANTITY DEMANDED OR QUANTITY SUPPLIED |
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PRICE ELASTICITY OF DEMAND |
A MEASURE OF HOW MUCH THE QUANTITY DEMANDED RESPONDS TO THE CHANGE IN PRICE. FORMULA: % CHANGE IN Qd / % CHANGE IN P |
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TOTAL REVENUE |
THE AMOUNT PAID BY BUYERS AND RECEIVED BY SELLERS OF A GOOD. FORMULA: (P)(Q) |
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INCOME ELASTICITY OF DEMAND |
A MEASURE OF HOW MUCH THE QUANTITY DEMANDED OF A GOOD RESPONDS TO CHANGE IN CONSUMERS INCOME. FORMULA: % CHANGE IN Qd / % CHANGE IN INC. |
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CROSS-PRICE ELASTICITY OF DEMAND |
A MEASURE OF HOW MUCH THE QUANTITY DEMANDED OF A GOOD RESPONDS TO A CHANGE IN THE PRICE OF ANOTHER GOOD FORMULA: % CHANGE IN Qd OF ONE GOOD / % CHANGE IN THE PRICE OF ANOTHER GOOD |
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PRICE ELASTICITY OF SUPPLY |
A MEASURE OF HOW MUCH THE QUANTITY SUPPLIED RESPONDS TO A CHANGE IN THE PRICE FORMULA: % CHANGE IN Qs / % CHANGE IN P |
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PRICE CEILING |
THE MAXIMUM PRICE THAT A GOOD CAN BE SOLD FOR |
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PRICE FLOOR |
THE MINIMUM PRICE THAT A GOOD CAN BE SOLD FOR |
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TAX INCIDENCE |
THE WAY THE TAX BURDEN IS SHARED AMONG PARTICIPANTS |
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WILLINGNESS TO PAY |
THE MAXIMUM AMOUNT THAT A BUYER WILL PAY FOR A GOOD |
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CONSUMER SURPLUS |
THE BUYERS WILLINGNESS TO PAY MINUS THE AMOUNT THE BUYER ACTUALLY PAYS |
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PRODUCER SURPLUS |
THE AMOUNT THE SELLER IS PAID FOR A GOOD MINUS THE SELLERS COST |
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DEADWEIGHT LOSS |
THE FALL IN TOTAL SURPLUS THAT RESULTS FROM A MARKET DISTORTION |
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WORLD PRICE |
THE PRICE OF A GOOD THAT PREVAILS IN THE WORLD MARKET FOR THAT GOOD |
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TARIFF |
A TAX ON A GOOD PRODUCED ABROAD AND SOLD DOMESTICALLY |
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INTERNALIZING THE EXTERNALITY |
CHANGE INCENTIVES SO THAT PEOPLE TAKE ACCOUNT OF THE EXTERNAL EFFECTS OF THEIR ACTIONS |
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CORRECTIVE TAXES |
TAXES ENACTED TO CORRECT THE EFFECTS OF NEGATIVE EXTERNALITIES |
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COASE THEOREM |
PRIVATE PARTIES CAN BARGAIN WITHOUT COST OVER THE ALLOCATION OF RESOURCES, THEY CAN SOLVE THE PROBLEM OF EXTERNALITIES ON THEIR OWN |
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TRANSACTION COSTS |
THE COST THAT PARTIES INCUR IN THE PROCESS OF AGREEING TO AND FOLLOWING THROUGH ON A BARGAIN. |
