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16 Cards in this Set

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  • Back
Scarcity
Society has limited resources and therefore cannot produce all the good and services people wish to have.
Economics
Study of how society manages its scarce resouces
Efficiency
The property of society getting the most it can from its scarce resouces
Equity
The property of distributing economic prosperity fairly among the members of society
Opportunity Cost
Whatever must be given up to obtain some item
Rational people
People who systematically and purposefully do the best they can to achieve their objectives
Marginal Changes
Small incremental adjustments to a plan of action
Incentive
Something that induces a person to act.
Market Economy
An economy that allocates resources through the decentralized decisions of many firms and households as they interact in markets for good and services.
Property rights
The ability of an individual to own and exercise control over scarce resouces.
Market Failure
a situation in which a market left on its own fails to allocate resources efficiently
Externality
the impact of one persons action on the well being of a bystander.
Market Power
the ability of a single economic actor to have a substantial influenceon market prices.
Productivity
the quantity of goods and services produced from each hour of a workers time
Inflations
an increase in the overall level of prices in the economy
Business Cycle
fluctuatins in economic activity, such as employment and production