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17 Cards in this Set
- Front
- Back
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What is a MODEL?
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A simplified representation of a real situation that is used to better understand real-life situations.
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What is the concept behind OTHER THINGS BEING EQUAL?
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Means that all other relevant factors remain unchanged.
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What is Production Possibility Frontier?
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Illistrates the trade-offs facing an economy that produces only 2 goods. It shows the maximum quantity of one good that can be produced for any given quantity produced of the other good.
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What are FACTORS OF PRODUCTION
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Resources used to produce goods and services.
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Describe LAND as a factor of production?
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Land is a resource supplied by nature.
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Describe LABOR as a factor of production?
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Labor is the economy's pool of workers.
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Describe CAPITAL as a factor of production?
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Capital refers to "created resources such as machines and buildings.
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Describe HUMAN CAPITAL as a factor of production?
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Human capital refers to the educational achievements and skills of the labor force, which enhances its productivity.
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What is TECHNOLOGY?
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Is the technical means for producing goods and services.
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When does an individual have COMPARATIVE ADVANTAGE?
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When in producing a good or service if the opportunity cost of producing the good or service is lower for that individual than for other people.
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When does an individual have ABSOLUTE ADVANTAGE?
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In an activity if she or he can do it better than other people.
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What is POSITIVE ECONOMICS?
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The branch of economic analysis that describes the way the economy actually works.
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What is NORMATIVE ECONOMICS?
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Makes a prescriptions about the way the economy should work.
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What is the role of the MEDIA in disagreements between economists?
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The media many times print or draw to attention the disagreements or economists and not so much the agreements because it is not considered newsworthy.
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What is the role of the INTEREST GROUPS in disagreements between economists?
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they seek out the opinions of economists that share the same opinions and give them visability when their colleagues may disagree widely.
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What is the role of the DIFFERENCES IN VALUE SYSTEMS in disagreements between economists?
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Economists have different values and therefore will differ in opinion on certain issues.
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What is the role of the DIFFERENT MODELS used in disagreements between economists?
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Disagreements in simplications and use of different variables to place importance on.
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