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28 Cards in this Set
- Front
- Back
the condition that arises because the available resources are insufficient to satisfy wants
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scarcity
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social science that studies the choices that we make to cope with scarcity
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economics
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study of the choices of individuals and businesses, the interaction of these choices, and the influence the government exerts on these choices
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mircoeconomics
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study of the aggregate(or total) effects on the national or global economy from the choices, individuals, businesses, or governments make
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macroeconomics
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these statements can be right or wrong and can be tested
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what is or positive statements
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statements depend on values and cannot be tested
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what ought to be or normative statements
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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
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economic model
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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
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economic theory
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other things remaining the same
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ceteris paribus
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one factor of interest is different and others are equal/similar
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natural experiments
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look for correlations
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statistical investigations
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tendency for the values of two variables to move in a predictable and related way
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correlation
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The error of reasoning that a first event caused a second, because the first occured before the second
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post Hoc Fallacy
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what you must give up to get something
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cost
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what you gain when you get something, measured by what you are willing to give up
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benefit
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best thing you must give up
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opportunity cost
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previously incurred, irreversible cost
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sunk cost
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choice made by comparing all the relevant alternatives, systematically and incrementally
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margin
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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)
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marginal cost
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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)
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marginal benefit
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an inducement to take a particular action
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incentive
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a graph of the values of one variable against the value of another
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scatter diagram
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measures time on the x axis and variable(s) on the y axis
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time series graph
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general tendency for the value of a variable to rise or fall
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trend
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(uses bars) shows values of an economic variable for different groups in a population at a point in time
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cross section
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relationship between two variables that move in the same direction
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positive/direct
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relationship between two variables that move in opposite directions
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negative/inverse
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measures the influence of one variable on another
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slope
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