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17 Cards in this Set

  • Front
  • Back
Define Economics
Study of:-choices made to satisfy wants and needs, -process by which goods and services are produced, -govt plicies on economies and economic stability
Define Scarcity
Not being able to have all goods and services because there is not enough resources, all societies have scarcity
Define Opportunity Cost
The cost of the next best alternative use of money, time, or resources
Define Tradeoffs
Giving up something to get more of a different thing
Explain the Idea of the Invisible Hand
Companies and resource suppliers pursuing their self interest use most efficent process and further innovations. By doing that it promotes public interest (helps others)
What is the importance of Adam Smith to Economics?
Wrote the 'Wealth of Nations' in 1776 about the basc principles of economic and created the concept of the invisible hand.
What does Ceteris Paribus mean?
When measuring in economics one assumes that everything is staying the same except what is being measured.
Explain the difference between positive and normaitive economics.
Positive econ. is concerned with straight facts and Normative econ. is concerned with value and judgenments.
What 3 questions must all economic systems answer?
1)What to produce 2)How to produce it 3)For whom to produce
Define Per-Unit Opportunity Cost
(Units of goods or services lost)/(Units of goods or services produced)
What are the characteristics of a Market System Economy
Laissez Faire, individual decisions with free choice and enterprise
What are the characteristics of a Command Economy
Centralized decisions, usually by govt. Property is owned by society.
What are the characteristics of a Traditional Economy
Production methods, exchange and income distribution are sanctioned by custom
What market system is the USA?
A combo of free market and command, ppl and comanies act in their best interest w/o govt intereference and ownership of private property
What is the difference between Microeconomics and Macro Economics?
Microeconomics is the study of ppl and businesses w/in a single market Macroeconomics is the study of the whole market
Define Markets
A location or mechanism that allows buyers and sellers to deal readily in a certian economic product.
What does a Market consist of?
consumers, firms, and households