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Economics Midterm
Ch. 8
9
Economics
Undergraduate 3
10/24/2008

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Cards

Term
Tariff
Definition
A tax imposed by government on imports.
Term
Imports
Definition
Goods and services bought domestically but sold to other countries.
Term
Exports
Definition
Goods and services produced domestically but sold to other countries.
Term
Comparative advantage
Definition
The ability of an individual, a firm, or country to produce a good or service at a lower opportunity cost than competitors.
Term
Opportunity cost
Definition
The highest-valued alternative that must be given up to engage in an activity.
Term
Absolute advantage
Definition
The ability to produce more of a good or service than competitors when using the same amount of resources.
Term
Autarky
Definition
A situation in which a country does not trade with other countries.
Term
Terms of trade
Definition
The ratio at which a country can trade its exports for imports from other countries.
Term
External Economies
Definition
Reductions in a firm's costs that result from an increase in the size of an industry.
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