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16 Cards in this Set
- Front
- Back
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Scarcity
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society has a limited amount of resources
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Economics
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the study of how society manages its scarce resources
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Efficiency
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the property of society getting the most benefit from its resources
the size of the pie |
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Equity
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the distribution of those benefits to all society
the slices of the pie (the more equal the slices are, the smaller the pie gets) |
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Opportunity Cost
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whatever must be given up to obtain another item
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Rational People
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people who do their best to attain their objectives
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Marginal Changes
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small incremental changes to a plan
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Incentive
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something that induces a person to act (possibility of punishment or reward)
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Market Economy
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In such an economy, the decisions made by a central planner are replaced by the decisions of the households
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Property Rights
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the ability of individuals to own and exercise control over scarce resources
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Market Failure
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a situation in which a market that is left alone fails to allocate its resources efficiently
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Externality
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the impact of one person's action on a bystander
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Market Power
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the ability of a person (or a small group) to unduly influence market prices
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Productivity
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the quantity of goods/services an individual produces in one hour
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Inflation
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the overall increase of the level of prices in the economy
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Business Cycle
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fluctuations in economic activity, as measured by the production of goods/services or the number of people employed
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