Term
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Definition
| the condition that results from society not having enough resources to produce all the things people would like to have |
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Term
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Definition
| the study of how people try to satisfy what appears to be seemingly unlimited and competing wants through the careful use of relatively scarce resources |
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Term
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Definition
| a basic requirement for survival and includes food, clothing, and shelter |
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Term
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Definition
| a way of expressing a need |
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Term
| What are the three economic questions? |
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Definition
| WHAT to produce, HOW to produce, FOR WHOM to produce |
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Term
| What factors of production? |
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Definition
| the resources required to produce the things we would like to have |
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Term
| What are the four factors of production? |
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Definition
| land, capital, labor, and entrepreneurs |
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Term
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Definition
| the "gifts of nature" or natural resources not created by humans |
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Term
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Definition
| the tools, equipment, machinery, and factories used in the production of goods and services |
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Term
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Definition
| people with all their efforts, abilities, and skills |
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Term
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Definition
| a risk-taker in search of profits who does something new with existing resources |
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Term
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Definition
| the process of creating goods and services |
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Term
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Definition
| the capacity to be useful and provide satisfaction |
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Term
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Definition
| a contradiction between necessities and value. the situation where some necessities have little monetary value while some non necessities have a much higher value. |
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Term
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Definition
| when work is arranged so that individual workers do fewer tasks than before |
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Term
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Definition
| when factors of production perform tasks that they can do relatively more efficiently than others |
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Term
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Definition
| the cost of the next best alternative use, money, time, or resources when one choice is made rather than another |
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Term
| Production possibilities frontier |
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Definition
| a diagram representing various combinations of goods and/or services an economy can produce when all productive resources are fully produced |
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Term
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Definition
| a way of thinking about a problem that compares the costs of an action to the benefits recieved |
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Term
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Definition
| an organized way of providing for the wants and needs of their people |
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Term
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Definition
| the allocation of scarce resources and nearly all other economic activity stems from ritual, habit, or custom. Individuals are not free to make decisions based on what they want or would like to have. their roles are defined by the customs of their elders and ancestors. |
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Term
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Definition
| a central authority makes most of the decisions. economic decisions are made by the government. the people have little, if any, influence over how the basic economic questions are answered. |
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Term
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Definition
| people and firms act in their own best interests to answer the economic questions. people's decisions act as votes. |
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Term
| What are the economic and social goals? |
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Definition
| Economic freedom, efficiency, equity, security, full employment, price stability, and economic growth. |
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Term
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Definition
| the extent to which persons or organizations are better off at the end of a period than they were at the beginning |
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Term
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Definition
| the driving force that encourages people and organizations to improve their material well-being |
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Term
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Definition
| the struggle among sellers to attract consumers while lowering costs |
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Term
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Definition
| the desire, ability, and willingness to buy a product |
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Term
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Definition
| the area of economics that deals with behavior and decision making by small units such as individuals and firms |
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Term
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Definition
| a graph showing the quantity demanded at each and every price that might prevail in the market |
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Term
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Definition
| the quantity demanded of a good or service varies inversely with its price. when price goes up, quantity demanded goes down. when price goes down, quantity demanded goes up. |
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Term
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Definition
| the extra usefulness or satisfaction a person gets from acquiring or using one more unit of a product |
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Term
| Diminishing marginal utility |
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Definition
| when the extra satisfaction we get from using additional quantities of the product begins to diminish |
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Term
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Definition
| can be used in place of other products |
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Term
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Definition
| the use of one product increases the use of another |
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Term
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Definition
| a measure of responsiveness that tells us how a dependent variable such as quantity responds to a change in an independent variable such as price |
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Term
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Definition
| the extent to which a change in price causes a change in the quantity demanded |
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Term
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Definition
| when a given change in price causes a relatively larger change in quantity demanded |
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Term
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Definition
| a given change in price causes a relatively smaller change in the quantity demanded |
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Term
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Definition
| the amount of a product that would be offered for sale at all possible prices that could prevail in the market |
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Term
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Definition
| the principle that suppliers will normally offer more for sale at high prices that could prevail in the market |
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Term
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Definition
| a graph showing the various quantities supplied at each and every price that might prevail in the market |
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Term
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Definition
| the monetary value of a product as established by supply and demand. communicate information and provide incentives to buyers and sellers. |
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Term
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Definition
| a system under which an agency such as government decides everyone's "fair" share |
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Term
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Definition
| a situation in which prices are relatively stable and the quantity of goods and services supplied is equal to the quantity demanded |
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Term
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Definition
| a situation in which the quantity supplied is greater than the quantity demanded at a given price |
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Term
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Definition
| a situation in which the quantity demanded is greater than the quantity supplied at a given price |
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Term
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Definition
| a maximum legal price that can be charged for a product |
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Term
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Definition
| the philosophy that government should not interfere with commerce or trade |
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Term
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Definition
| a market structure in which a few very large sellers dominate the industry |
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Term
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Definition
| a market structure with only one seller of a particular product |
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Term
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Definition
| a situation in which the average cost of production falls as the firm gets larger |
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Term
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Definition
| unintended side effect that either benefits or harms a third part not involved in the activity that caused it |
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Term
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Definition
| the harm, cost, or inconvenience suffered by a third part because of actions by others |
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Term
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Definition
| a benefit received by someone who had nothing to do with the activity that generated the benefit |
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Term
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Definition
| a relatively high tax designed to raise revenue and reduce consumption of a socially undesirable product such as liquor or tobacco |
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Term
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Definition
| the final burden of the tax |
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Term
| What are the criteria for effective taxes? |
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Definition
| Equity, simplicity, efficiency |
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Term
| What are the types of taxes? |
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Definition
| Individual income taxes, FICA taxes, and corporate income taxes. |
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Term
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Definition
| Created by 16th Amendment. Progressive income tax. |
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Term
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Definition
| tax levied on both employers and employees to pay for Social Security and medicare |
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Term
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Definition
| the tax a corporation pays on its profits |
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Term
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Definition
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Term
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Definition
| the tax the government levies on the transfer of property when a person dies |
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Term
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Definition
| a tax on tangible and intangible possessions such as real estate, buildings, furniture, automobiles, farm animals, stocks, bonds, and bank accounts |
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