Term
|
Definition
| the social science concerned with how individuals, institutions, and socitey make optimal choices under conditins of scarcity |
|
|
Term
|
Definition
|
|
Term
|
Definition
| to obtain more of one thing, socity forgoes the opportunity of getting the next best thing |
|
|
Term
|
Definition
| pleasure, happiness, or satisfaction obtained from consuming a good or service |
|
|
Term
|
Definition
| comparisons of marginal benefits and marginal costs |
|
|
Term
|
Definition
| a statement about economic behavior or the economy that enables prediction of the probable effects of certain actions |
|
|
Term
| other-things-equal assumption |
|
Definition
| the assumption that factors other than those being considered do not change |
|
|
Term
|
Definition
| the part of economics concerned with individual units such as a person, a household, a firm, or an industry |
|
|
Term
|
Definition
| examines either the economy as a whole or its basic subdivisions or aggregates, such as the government, household, and business sectors |
|
|
Term
|
Definition
| a collection of specific economic units treated as if they were one unit |
|
|
Term
|
Definition
| focuses on facts and cause-and-effect relationships. it includes description, theory development, and theory testing (theoretical economics) |
|
|
Term
|
Definition
| incorporates value judgments about what the economy should be like or what particular policy actions should be recommended to achieve a desirable goal (policy economics) |
|
|
Term
|
Definition
| the need to make choices because economic wants exceed economic means |
|
|
Term
|
Definition
| a schedule or curve that shows various combinations of two products a consumer can purchase with a specific money income |
|
|
Term
|
Definition
| all natural, human , and manufactured resources that go into the production of goods and services |
|
|
Term
|
Definition
| includes all natural resources used in the production process, such as arable land, forests, mineral and oil deposits, and water resources |
|
|
Term
|
Definition
| consists of physical and mental talents of individuals used in producing goods and services |
|
|
Term
|
Definition
| includes all manufactured aids used in producing consumer goods and services |
|
|
Term
|
Definition
|
|
Term
|
Definition
| the human resource that combines the other resources to produce a product, makes nonroutine decisions, innovates, and bears risks |
|
|
Term
|
Definition
| products that satisfy our wants directly, pizza |
|
|
Term
|
Definition
| products that satisfy our wants indirectly by making possible more efficient production of consumer goods; robots |
|
|
Term
| Production possibilities curve |
|
Definition
| displays the different combinations of goods and services that society can produce in a fully employed economy, assuming a fixed availablitiy of supplies of resources and constant technology |
|
|
Term
| law of increasing opportunity costs |
|
Definition
| as the production of a particular good increases, the opportunity cost of producing an additional unit rises |
|
|
Term
|
Definition
|
|
Term
|
Definition
| a particular set of institutional arrangements and a coordinating mechanism-- to respond to the economizing problem |
|
|
Term
|
Definition
| socialism or communisim; government owns most property resources and economic decision making occurs through a central economic plan |
|
|
Term
|
Definition
| capitalism; characterized by private ownership and resouces and the use of markets and prices to coordinate and direct economic activity |
|
|
Term
|
Definition
| private individuals and firms, not the government, own most of the property resouces (land and capital) |
|
|
Term
|
Definition
| ensures that entrepreneurs and private businesses are free to obtain and use economic resources to produce their choice of goods and services and to sell them in their chosen markets |
|
|
Term
|
Definition
| enables owners to employ or dispose of their property and money as they see fit |
|
|
Term
|
Definition
| the motivating force of the various economic units as they express their free choices |
|
|
Term
|
Definition
| freedom of choice exercised in pursuit of a monetary return |
|
|
Term
|
Definition
| the use of resources of an individual, firm, region, or nation to produce one or a few goods or services rather than the entire range of goods and services |
|
|
Term
|
Definition
| specialization of workers |
|
|
Term
|
Definition
|
|
Term
|
Definition
| determination by consumers of the types and quantities of goods and services that will be produced with the scarce resources of the economy |
|
|
Term
|
Definition
| the creation of new products and production methods completely destroys the market positions of firms that are wedded to existing products and older ways of doing business |
|
|
Term
|
Definition
| the tendency of firms and resource suppliers that seek to further their own self-interests in competitive markets to also promot the interests of society |
|
|
Term
|
Definition
| illustrates repetitive flows of goods and services, resources and money |
|
|
Term
|
Definition
| the place where resource or the services of resource suppliers arebought and sold |
|
|
Term
|
Definition
| shows the quantities of a product that will be purchased at various possible prices |
|
|
Term
|
Definition
| other things equal, as price falls, the quantity demanded rises, and as price rises, the quantity demanded falls |
|
|
Term
| diminishing marginal utitlity |
|
Definition
| the principle that as a consumer increases the consumption of a good or serviece, the marginal utility obtained from each additional unit of the good or service decreases |
|
|
Term
|
Definition
| factors that affect purchases |
|
|
Term
|
Definition
| products whose demand varies directly with money income are called superior goods |
|
|
Term
|
Definition
| goods whose demand varies inversely with money income |
|
|
Term
|
Definition
| one that can be used in place of another good |
|
|
Term
|
Definition
| one that is used together with another good |
|
|
Term
| change in quantity demanded |
|
Definition
| a movement from one point to another point |
|
|
Term
|
Definition
| a schedule or curve showing the various amounts of a product that producers are willing and able to make available for sale at each of a series of possible prices during a specific period |
|
|
Term
|
Definition
| as price rises, the quantity supplied rises; as price falls, the quantity supplied falls |
|
|
Term
|
Definition
| upward slope slope that reflects the law of supply |
|
|
Term
|
Definition
| resouce prices, technology, taxes and subsidies, prices of other goods, producer expectations, and the number of sellers in the market |
|
|
Term
|
Definition
| the price where the intentions of buyers and sellers match |
|
|
Term
|
Definition
| the quantity demanded and quantity supplied at the equilibrium price in a competitive market |
|
|
Term
|
Definition
|
|
Term
|
Definition
|
|
Term
|
Definition
| the production of any particular good in the least costly way |
|
|
Term
|
Definition
| the particular mix of goods and services most highly valued by society |
|
|
Term
|
Definition
| sets the maximum legal price a seller may charge for a product or service |
|
|
Term
|
Definition
| a minimum price fixed by the government |
|
|
Term
|
Definition
|
|
Term
|
Definition
| an organization that employs resources to produce goods and services for profit and operates one or more plants |
|
|
Term
|
Definition
| a group of firms that produce the sam, or similar, products |
|
|
Term
|
Definition
| a business owned and operated by one person |
|
|
Term
|
Definition
| two or more individuals agree to own and operate a business together |
|
|
Term
|
Definition
| a legal creation that can perfomr the functions of any other type of enterprise |
|
|
Term
|
Definition
| occurs when some of the costs or the benefits of a good are passed on to or "spill over to" someone other than the immediate buyer or seller |
|
|
Term
|
Definition
| production or consumption costs inflicted on a third party without compensation |
|
|
Term
|
Definition
| benefits to other producers or consumers; compensated spillovers accruing to third parties or the community at large |
|
|
Term
|
Definition
| people can ercieve benefits from a public good without having to pay for it |
|
|
Term
|
Definition
| education, streets, police protection, sewage disposal |
|
|
Term
|
Definition
| the % change in quantity demanded would be higher than the % change in price |
|
|
Term
|
Definition
| >1; close to horizontal; when consumers are highly responsive to price changes |
|
|
Term
|
Definition
| when consumers' responsiveness is only slight, or in rare cases non-existent |
|
|
Term
|
Definition
| there is no response to a change in price |
|
|
Term
|
Definition
| the total amount the seller recieves from the sale of a product in a particular time period |
|
|
Term
|
Definition
| Total satisfaction from a specific quantity |
|
|
Term
|
Definition
| Extra satisfaction from an additional unit |
|
|
Term
nLaw of diminishing marginal utility |
|
Definition
nExplains downward sloping demand |
|
|
Term
|
Definition
| Money income is allocated so that the last dollar spent on each product yields the same extra or marginal utility |
|
|
Term
| Opportunity cost = economic cost |
|
Definition
| the value of the best alternative use of a resource |
|
|
Term
|
Definition
| are the monetary payments a firm must make to an outsider to obtain a resource |
|
|
Term
|
Definition
| are the monetary income a firm sacrifices when it uses a resource it owns rather than supplying the resource in the market |
|
|
Term
|
Definition
| a payment that must be made by a firm to obtain and retain entrepreneurial ability. It is an implicit cost |
|
|
Term
|
Definition
| a time period in which producers are able to change the quantities of some but not all of the resources they employ |
|
|
Term
|
Definition
| a time period sufficiently long to enable producers to change the quantities of all the resources they employ |
|
|
Term
|
Definition
|
|
Term
|
Definition
| is the extra output or added product associated with adding a unit of a variable resource to the production process |
|
|
Term
|
Definition
| total output of a good or service produced by a firm |
|
|
Term
| law of diminishing returns states |
|
Definition
nas successive units of a variable resource are added to a fixed resource, the marginal product of the variable resource will eventually decline.
nassumes that technology is fixed and thus the way you produce does not change. |
|
|
Term
|
Definition
| do not change in total when the firm changes its output |
|
|
Term
|
Definition
| increase or decrease with a firm’s output |
|
|
Term
|
Definition
| the sum of fixed cost and variable cost |
|
|
Term
|
Definition
| a firm’s total fixed cost divided by output |
|
|
Term
| Average variable cost (AVC) |
|
Definition
| a firm’s total variable cost divided by output |
|
|
Term
|
Definition
| a firm’s total cost divided by output |
|
|
