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23 Cards in this Set
- Front
- Back
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Comparative advantage |
Gives a company the ability to sell goods at a lower price to realize stronger sales margins.
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Comparative advantage |
Is not the best at producing, it just sacrifices less to do so. |
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Economy |
A system for coordinating society's productive activities. |
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Economics |
The social science that studies the production, distribution, and consumption of goods and services. |
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Market Economy |
An economy in which decisions about production and consumption are made by individual producers and consumers. |
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Command Economy |
Central Authority makes production and consumption decisions.
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Invisible hand |
Refers to the way in which the individual pursuit of self interest can lead to good results for society as a whole. |
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Microeconomics |
the branch of economics that studies how people make decisions and how these decisions interact. |
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Market Failure |
when the individual pursuit of self interest leads to bad results for society as a whole. |
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Recession |
a downturn in the economy |
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macroeconomics |
branch of economics concerned with overall ups and downs in the economy. |
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economic growth |
the growing ability of the economy to produce goods and services. |
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Individual choice |
the decision by an individual of what to do, which necessarily involves a decision of what not to do. |
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Resource |
anything that can be used to produce something else. Land/ Labor/ Capitol |
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scarce |
not enough of the resources are available to satisfy all the various ways a society wants to use them. Natural resources/ human resources |
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Opportunity cost |
what you must give up in order to get an item. |
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Trade off |
when you compare the costs with the benefits of doing something
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marginal decisions |
decisions about whether to do a bit more or a bit less of an activity.
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marginal analysis |
the study of marginal decisions |
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incentive |
anything that offers rewards to people who change their behavior. |
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gains from trade |
people can get more of what they want through trade than they would if they tried to be self sufficient. |
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specialization |
each person specializes in the task that he or she is good at performing. |
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equity |
means that everyone gets his or her fair share. trumps efficiency. |
