Economics Part 2 Of 1

Front 1

Economics

Back 1

Study of how people deal w scarcity

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Scarcity

Back 2

Situation in which the quantity of resources doesn’t meet all wants macroe

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Macroeconomic

Back 3

Study of economic behavior of entire economies

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Production Possibilities

Back 4

alternative combinations of production of various goods that are possible, given the economy’s resources

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Production possibility curve

Back 5

A curve showing the maximum combinations of production of 2 goods that are possible, given the economy’s resources and technology

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Increasing opportunity cost

Back 6

A situation in which producing more of 1 good requires giving up an increasing amount of production of another good

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Market Economy

Back 7

How what and for whom to produce are decided by individual firms, consumers and governments interacting in markets.

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Command Economy

Back 8

Decisions of how, what, and for whom to produce are determined by government

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Capitalism

Back 9

An economic system in which capital is individually owned and production and employment decisions are decentralized (laissex fairy)

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Socialism

Back 10

An economic system in which the government owns and controls all the capital and makes decisions about prices and quantities

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Mixed economy

Back 11

A market economy in which the gov. plays a very large role

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Positive Economics

Back 12

Analysis that Explains what happens in economy and why, w/o making recommendations about economic policy.

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Normative

Back 13

Analysis that aim to recommend policies about what the government should do

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Fallacy

Back 14

Incorrect idea or belief

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Demand

Back 15

Relationship between price and quantity demanded

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Law of demand

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The quantity of a good or service demanded varies inversely with its price, ceteris paribus.

The tendency for the quantity demanded of a good in a market to decline as its price rises

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Other things equal, when the price of a good or service falls,

Back 17

the quantity demanded increases

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Demand is the entire relationship between

Back 18

Price and quantity demanded

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Demand is the entire relationship between

Back 19

Price and quantity demanded

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Quantity demanded

Back 20

Amount of money or other goods 1 must pay to obtain a particular good.

Amount of a good consumers are willing and able to buy at a particular price.

A point in the demand curve.

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Market Demand

Back 21

Relation between the price of a good and the quantity purchased.

Front 22

Shift in demand curve

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Moves right or left

Resulting from a change in 1 of the determinants of demand

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Supply

Back 23

Relationship between price and quantity supplied

Front 24

Quantity supply

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Quantity of a good that firms are willing to sell at a given price

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Law of supply

Back 25

Tendency for the quantity supplied of a good in a market to increase as the price rises

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Market Supply

Back 26

Relation between the price of a good and the quantity all producers are willing and able to sell

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Supply curve

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Upward curve. Relationship between price and quantity supplied

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Equilibrium

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Quantity demanded = quantity supplied

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Equilibrium price

Back 29

The price at which quantity supplied equals quantity demanded

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Causes shift in demand curve

Back 30

Money income of consumers

Prices of other goods

Consumer expectations

Consumer tastes

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Causes of shifts of the supply curve

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State of technology

Prices of resources

Prices of other goods

Producer expectations

Number of producers in market