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39 Cards in this Set

  • Front
  • Back
The study of how best to Allocate scarce resources amoung competing uses.
Lack of enough resources to satisfy all desired uses of those resources.
Factors of Production
Final goods produced for the use in the production of other goods--- Equipment Structures Technology
The Assesmbling of resources to produce new or improved products and technologies
Opportunity Cost
The most desired goods or services that are forgone to obtain something else.
Production Possibilities
the Possibility in the number of products produced through given resources in a given time period.
the amount of product that can be produced with all the resources and technology
Economic Growth
An increase in output(Real GDP); an expansion of the production possibilities.
Economic Decline
A decrease in the output
(Real GDP); shrinkage in the production possibilities.
Market Mechanism
The use of Market prices and sales to signal desired outputs (Or resouce allocation)
Laissez Faire
The doctrine of "leave it alone," of non intervention in the market meechanism.
Mixed Economy
An economy that uses both market signals and government directives to allocate goods and resources.
Market Failure
An imperfection in the market mechanism that prevents optimal outcomes.
Government Failure
Government intervention that fails to improve economic outcomes.
The study of aggregate economic behavior.
The study if individual behavior in the economy,of the components of the larger economy
Ceteris Paribus
The assumption of nothing changing.
what economist focus on when they look at the economy
WHAT goods and services does the US Produce?

How is that output produced?

FOR WHOM is the output produced?
Per Capitia GDP
The dollar Value of the GDP divided by total population; average GPD
Income Transfers
Payments to individuals for which no current goods or services are exchanged

--> Social security, Finacial aids
Goods and services sold to foreign buyers
Goods and services purchased from forign sources.
Net Exports
The value of Exports minus the value of imports.
Human Capital
The knowlege and skills possesed by the work force
Output per unit of input such as output per labor hour
the process of relocating all or part of a production processes to another country.
Government responcibilities
Provide a leagal framework
Protect the enviroment
Protect the consumers
Protect the labor
A firm that produces the entire market supply of a particualar good or service.
Income Quintile
One fifth of the population, rank ordered by income.
Factor market
anyplace where factors of production(Land labor and capital) are bought and sold
Product market
Any place where finished goods and services are bought and sold.
The law of Supply
The total quantities of a good that sellers are willing and able to sell at alternative prices
The law of Demand
The quantitiy of a good demanded ina given time period increases as its price falls
Substitute Good
Goods that substitute each other; when the price of a good rises, ther deman for another good increases
Complimentary good
goods frequently consumed in combination; when the price of goodx rises the deman for good y falls.
The determinants of Demand
Other goods
Number of buyers
The determinants of Market supply
Factor Cost
Other Goods
Taxes and Subsides
Number of sellers.
Equilibrium Price
The Price at which the quantity of a good demanded in a given timeperiod equalsthe quantity supplied.