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| A reward that encourages an action or a penalty that discourages an action |
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| Inability to get everything we want |
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| The social science that studies the choices that individuals, business, governments, and entire societies make as they cope with scarcity and the incentive's that influence and reconcile those choices. |
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| the study of the choices that individuals and businesses make |
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| THe study of the performance of the national economy and the global economy |
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| physical objects such as cell phones and books |
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| tasks performed for people such as hair cuts or cell phone reparis |
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| Land Labor Capital Entrepreneruship |
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| All natural resources, land, fish, forests, oil |
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| The work time and work effort that people devote to producing goods and services |
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| knowledge and skill that people obtain from education, on the job training, and work experiences |
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| Tools, insturments, machines, buildings, and other construcions that business use to produce goods and services |
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| Different from capital, includes money stock and bonds |
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| Human resource that organizes labor land and capital |
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| Wages earn around(?%) of total income |
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| A choice that you make if you think it is best for yourself |
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| A choice that leads to an outcome that is the best for society as a whole. |
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| giving up one thing to get something else |
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| One that compares costs and benefits and achieves the greatest benefit over cost for the person making the choice |
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| the gain or pleasure that a good or service brings |
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| What a person likes or dislikes |
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| the highest valued alternative that must be given up to get it |
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| Benefit that a person receives from consuming one more unit of a good or service. |
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| THe opportunity cost of producing one more unit of a good or service. |
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| Statements that can be tested |
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| A statement that is dependent on values, it can not be tested |
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| A description of some aspect of the economic world that includes only those features that are needed for the purpose at hand. |
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| The ability of a country, individual, company or region to produce a good or service at a lower cost per unit than the cost at which any other entity produces that good or service |
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| A situation in which goods are services are produced at the lowest possible cost and in the quantities that provide the greatest possible benefit. |
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| The growth of capital resources including human capital |
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| A person or country has a comparative advantage in an activity if that person or country can perform the activity at a lower opportunity cost than anyone else or another country |
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| The expansion of production possibilities |
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| An economic unit that hires factors of production and organize those factors to produce and sell goods and services |
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| A curve that shows the relationship between the marginal benefit of a good and the quantity of that good consumed |
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| Any arrangement that enables buyer and sellers to get information and to do business with each other |
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| Any commodity or token that is generally acceptable as the means of payment |
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| A situation in which goods and services are produced at the lowest possible cost |
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| PPF (Production Possibilities Frontier) |
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| The boundary between the combinations of goods and services that can be produced and the combinations that cannot |
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| The social arrangements that govern the ownership, use, and disposal of anything that people value. Property rights are enforceable in court. |
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| The development of new goods and of better ways of producing goods and services. |
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| A change in buyers' plans that occurs when some influence on those plans other than the price of the good changes. It is illustrated by a shift of the demand curve |
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| A change in seller's plans that occurs when some influece on those plans other than the price of the good changes. It is illustrated by a shift of the supply curve. |
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| Change in the quantity demand |
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| A change in the buyers' plans that occurs when the price of a good changes but all other influences on buyers' plans remain unchanged. It is illustrated by a movement along the demand curve |
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| Change in the quantity supplied |
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| A change in sellers' plans that occurs when the price of a good changes but all other influences on sellers' plans remain unchanged. It is illustrated by a movement along the supply curve. |
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| A market that has many buyer and sellers so that not one can influence the price |
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| A good that is used in conjunction with another good |
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| The entire relationship between the price of the good and the quantity demanded of it when all other influence on buyers' plans remain the same. It is illustrated by a demand curve and described by a demand schedule |
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| A curve that shows the relationship between the quantity demanded of a good and its price when all other influences on consumers' planned purchases remain the same |
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| The price at which the quantity demanded equals the quantity supplied |
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| The quantity bought and sold at the equilibrium price |
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| A good for which demand decreases as income increases. |
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| Other things remaining the same, the higher the price of a good, the smaller is the quantity demanded of it. The lower the price of a good the larger is the quantity demanded of it. |
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| Other things remaining the same the higher the price of a good, the greater is the quantity supplied of it |
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| The number of dollars that must be given up in exchange for a good or service |
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| A good for which demand increases as income increases |
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| The amount of a good or service that consumers plan to buy during a given time period at a particular price |
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| The amount of a good or service that producers plan to sell during a given time period at a particular price. |
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| The ratio of the price of one good or service to the price of another good or service. A relative price is an opportunity cost |
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| A good that can be used in place of another one |
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| The entire relationship between the price of a good and the quantity supplied of it when all other influences on producers' planned sales remain the same. It is described by a supply schedule and illustrated by a supply curve. |
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| A curve that shows the relationship between the quantity supplied of a good and its price when all other influences on producers' planned sales remain the same. |
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| Cross Elasticity of Demand |
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Definition
| THe responsiveness of the demand for a good to a change in the price of a substitute or compliment, other things remaining the same. it is calculated as the percentage change in the quantity demanded of the good divided by the percentage change in the price of the substitute or complement. |
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| Demand with a price elasticity greater than 1. The percent change in quantity is greater than percent change in price |
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| The responsiveness of the quantity supplied of a good to a change in its price other things remain the same |
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| Income Elasticity of demand |
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| The responsiveness of demand to a change in income, It is calculated as the percentage change in the quantity demanded divided by the percentage change in income. |
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| A demand with a price elasticity between 0 and 1. Percent change in quantity demand is less than percent change in price. |
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| Demand with an infinite price elasticity1; the quantity demanded changes by an infinitely large percentage in response to a tiny price change. |
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| Perfectly Inelastic Demand |
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| Demand with a price elasticity of zero; the quantity demanded changes remains constant when the price changes. |
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| Price Elasticity of demand |
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| A units free measuer of the responsiveness of the quantity demanded of a good to a change in its price, when all other influences on buyers' plans remains the same. |
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| The value of a firm's sales. It is calculated as the price of the good multiplied by the quantity sold. |
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