Details Title: CHAP 2 ECON 2020 Description: Final Exam Flashcards Total Flash Cards: 21 Created: 05/04/2009 13:04:10		New Users: To study from this flashcard set, or to create your own your own study flash cards, REGISTER HERE. Existing Users: CLICK HERE. Additional Economics Flashcards
Cards in this set: Term Production Possibilities Frontier Definition PPF, A curve showing the maximum attainable combinations of two products that may be produced with available resources and current technology. Term Opportunity Cost Definition The highest valued alternative that must be given up in order to engage in a given activity. Term Economic Growth Definition The ability of the economy to produce increasing quantities of goods and services. Term Trade Definition The act of buying and selling. Term Absolute Advantage Definition The ability of an individual, a firm, or a country to produce more of a good or service than competitors using the same amount of resources. Term Comparative Advantage Definition The ability of an individual, a firm, or a country to produce a good or service at a lower opportunity cost that competitors. Term Market Definition A group of buyers and sellers of a good or service and the institution or arrangement by which they come together to trade. Term Product Markets Definition Markets for goods--such as computers--and services--such as medical treatment. Term Factor Markets Definition Markets for the factors of production. Term Factors of Production Definition Labor, Capital, Natural Resources, and Entrepreneurial Ability. Term Labor Definition All types of work. Term Capital Definition Physical capital, such as computers and machine tools, that are used to produce other goods. Term Natural Resources Definition Land, water, iron ore, oil, and other raw materials that are used in producing goods. Term Entrepreneur Definition A person who operates a business, carries a connotation of risk taker. Term Two key groups that participate in Markets (2.3) Definition Households and firms. Term Household Definition Suppliers of factors of production. Mostly labor. Term Firm Definition Suppliers of goods and services. Term Circular Flow Diagram Definition A model that illustrates how participants in markets are linked. Term Free Market Definition A market with few government restrictions on how a good or service can be produced or sold or on how a factor of production can be employed. Term Property Rights Definition The rights individuals or firms have the exclusive use of their property, including the right to buy or sell it. Term Property Definition Tangible, like land or a store or a factory, or Intangible, like an idea.