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24 Cards in this Set

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What is quantity demanded?
the amount of any good, service, or resource that people are willing and able to buy during a specified period at a specified price.
What is quantity supplied?
the amount of any good, service, or resource that people are willing and able to sell during a specifed period at a specifed price
supply
the relationship between the quantity supplied and the price of a good when all other influences on selling plans remain the same.
demand
the relationship between the quantity demanded and the price of a good when all other influences on buying plans remain the same.
law of demand
other things remaining the same,if the price of a good rises, the quantity demanded of that good decreases; and if the price of a good falls, the quantity demanded of that good increases.
inferior good
a good for which demand decreases when income increases.
marginal benefits
the benefit that arises from a one unit increase in an activity. the marginal benefit of something is measured by what you are willing to give up to get one more unit of it
economic problems: what goods and services get produced and in what quantites?
whatever people value and produce to satisfy human wants. goods are physical items such as balls as services are like haircuts.
econ. problem: how are goods and services produced?
they are many ways to produce g& s
econ. problems: for whom are goods and services produced?
answer depends on the income that people earn and the prices they pay for items. people with higher incomes are able to buy more goods and services than a peron with low income
opportunity cost
the alternative that you must give up to get something
factors of production
land-natural resources used to produce g and s;labor -people work efforts to producing a g and s; human capital-knowledge and skill that people obtain from edu., on the job experience and work experience. capitol- tools and etc used to produce goods and services.
entrepreneurship- human resources that organizes labor, land and capital
efficiency
a situation in which the quantities of goods and services produced are those that people value most highly-in which we cannot produce more of a good or service without giving up some of another good or service that people value more highly.
marginal costs
the cost that arises from a one unit increase in an activity. the marginal cost of soemthing is what you must giv eup to get one more unit of it.
scarcity
the condition that arises becasue the available resources are insufficient to satify wants.
marginal utility
the change in total utility that results from a one unit increase in the quantity of a good comsumed
determinates of demand
prices of related goods, income, expectations, number of buyers, preferences
determinates of supply
prices of related goods, prices of resources and other inputs, expectations, number of sellers and productivity.
What is the meaninf of scarcity? Why is this notion important in economics?
Scarcity is when the available resources are insufficent to satisfy wants. This is important because it helps us make decisions in life on what we would give up to get something else.
Why should a person consider marginal cost and marginal benefit when making an economic decision?
A person should consider their marginal cost and benefit when making a decision becasue margingal cost is what you give up to get one more of something. So say you want to go to the movies, but you want to save money for a necklace. You give up seeing a movie so save money for the necklace. and the marginal benefit of not going to the moving is that you will gain that extra moenyt hat would of been lost if you went to the movie.
what is the difference between a change in demand and a change in quantity demand?
change in quantity demanded is when the price changes but a change in demand is when any influence on buying plans other than the price changes.
describe the meaning of price elasticity of demand and how price elasticity affects business decisions
it is when the price changes but all other influences on the buyer's plan remians the same.
the best things in life are free....what is right/wrong with this statement?
false. regardless of the price of something, you are always going to have to give up doing something in order to get something else. For example, if you want to spend more time with you family, you will have to spend less time at work and could risk not losing your job but becoming more successfula tyour job.
list and describe the 4 resource categories. what do economists mean whne they say that economics resources or factors of production are scare or limited in supply?
land is all the natural resources used to produce goods and services, labor is the work effort that people use to produce goods and service, capital is all the tools used to produce goods and services, and entreprenurship organizes all the land, labor and capital. when they say are scare it means that the avaible resources are insuffiecnt to satisfy wants.