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28 Cards in this Set

  • Front
  • Back
the condition that arises because the available resources are insufficient to satisfy wants
social science that studies the choices that we make to cope with scarcity
study of the choices of individuals and businesses, the interaction of these choices, and the influence the government exerts on these choices
study of the aggregate(or total) effects on the national or global economy from the choices, individuals, businesses, or governments make
these statements can be right or wrong and can be tested
what is or positive statements
statements depend on values and cannot be tested
what ought to be or normative statements
a description of some aspect of the economic world, that includes only those features of the world thaty are needed for the purpose at hand
economic model
a generalization that summarizes what we understand about the economic choices the people, industries, and nations make based on models that have repeatedly passed the test of corresponding with real-world data
economic theory
other things remaining the same
ceteris paribus
one factor of interest is different and others are equal/similar
natural experiments
look for correlations
statistical investigations
tendency for the values of two variables to move in a predictable and related way
The error of reasoning that a first event caused a second, because the first occured before the second
post Hoc Fallacy
what you must give up to get something
what you gain when you get something, measured by what you are willing to give up
best thing you must give up
opportunity cost
previously incurred, irreversible cost
sunk cost
choice made by comparing all the relevant alternatives, systematically and incrementally
the cost that arises from a one-unit increase in an activity, measured by what you are willing to give up (increases with each unit of activity)
marginal cost
benefit that arises from a one-unit increase in an activity, measured by what you are willing to give up (decreases with each unit of activity)
marginal benefit
an inducement to take a particular action
a graph of the values of one variable against the value of another
scatter diagram
measures time on the x axis and variable(s) on the y axis
time series graph
general tendency for the value of a variable to rise or fall
(uses bars) shows values of an economic variable for different groups in a population at a point in time
cross section
relationship between two variables that move in the same direction
relationship between two variables that move in opposite directions
measures the influence of one variable on another