Study your flashcards anywhere!

Download the official Cram app for free >

  • Shuffle
    Toggle On
    Toggle Off
  • Alphabetize
    Toggle On
    Toggle Off
  • Front First
    Toggle On
    Toggle Off
  • Both Sides
    Toggle On
    Toggle Off
  • Read
    Toggle On
    Toggle Off
Reading...
Front

How to study your flashcards.

Right/Left arrow keys: Navigate between flashcards.right arrow keyleft arrow key

Up/Down arrow keys: Flip the card between the front and back.down keyup key

H key: Show hint (3rd side).h key

A key: Read text to speech.a key

image

Play button

image

Play button

image

Progress

1/30

Click to flip

30 Cards in this Set

  • Front
  • Back
Scarcity
The inability to satisfy all our wants.
Economics
Is the social science that studies the choices that individuals, business, governments, and entire societies make as they cope with sarcity and incentives that influence and reconcile those choices.
Incentives
A reward that encourages an action or a penalty that discourages one.
Goods and services
Are objects that people value and produce to satisfy human wants.
Trade-off
Is an excahange- giving up one thinng to get something else
Opportunity cost
The highest valued alternative hat we give up to give something.
Marginal Cost
The cost of an increase in an activity
Ceteris Paribus
A latin term that means "other things being equal" or"If all other relevant things remain the same
Marginal Cost
The oppurtunity cost of producing one more unit of that good or service. It is calculated as the increase in total ost divided by the increase in output.
Comparitive advantage
A person or country has a comparitive advantage in a n activity if that person or country can perform the actuvuty at a lower oppurtunity cost than anyone else.
Absolute advantage
A person has an absolute advantage if that person is more productive than another person.
Firm
Is an economic unit that hires factors of production and organizes those factors to produce and sell goods and services.
Market
Is any arrangement that enables buyers and sellers to get information and to do business with each other.
Money
Is any commodity or token that is generally acceptable as means of payment.
Competetive market
A market that has many buyers and sellers, so no single buyer or seller can influence the price.
Money Price
the number of dollars that must be given up on exchange for a good or service
relative price
The ratio of one price to another (an oppurtunity cost)
Law of Demand
Other things remaining the same, the higher the price of a good, the smaller is the quantity damanded; and the lower the price of a good, the greater is the quantity demanded.
Demand
1. Want it
2.Can afford to buy it
3. Plan to buy it
Substitute
A good that can be used in place of another good.
Complement
A good that can be used in conjuction with another good.
Normal Good
One for which demand increases as income increases.
Inferior Good
One for which demand decreases as income increases.
Supply
1. Has a resources and Technology to produce it.
2. Can profit from producint it.
3. Plans to produce and sell it
Law of Supply
Other things remaning the same, the higher the price of a good, the greater the quanitity supplied; and the lower the price of a good,the smaller is the quantity supplied.
Equlibrium Price
The price at which the quantity demanded equals the quantity supplied.
Equlibrium Quantity
The Quantity bought and sold at the equlibruim price.
Perfectly Elastic demand
Demand with an infinite price elasticity; the quantity demanded changes by an infinitely large percentagein response to a tiny price change.
Perfectly Inelastic Demand
Demand with a price elasticity of Zero; the quantity demanded remains constant when the price changes.
Income Elastiity of Demand
The responsiveness of demand to a change in income, other things remaining the same. It is calculated as the percentage change in the quantity demnded divided by the percentage change in income.