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Definition
| achieved by an economy if it produces at a point along its production possibilities curve that makes consumers as well off as possible. |
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| the advantage conferred by an individual if the opportunity cost of producing the good or service is lower for that individual then for other people. |
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| a falling in overall price level |
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Definition
| any tangible commodity produced and subsequently purchased to satisfy the current wants and perceived needs of the buyer. |
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Definition
| the branch of economics that studies how individuals, households, and firms make decisions and how those decisions interact |
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Definition
| a system for coordinating a society's productive and consumptive actives. |
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Definition
| A system of economics based on the private ownership of capital and production inputs, and on the production of goods and services for profit. |
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| the alteration between economic downturns knows as recessions, and economic upturns known as expansions |
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Definition
| a period of economic upturn in which output and employment are rising; also referred to as recovery |
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Term
| Ceteris Paribus (other things equal) |
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Definition
| important in economics because in the real world it is usually hard to isolate all the different variables. isolate a variable! |
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Definition
| achieved by an economy if it produces at a point on its production possibilities curve |
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Term
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Definition
| the study of the costs and benefits of doing a little bit more of an activity versus a little bit less |
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Definition
| the economy's total production of goods and services for a given time period |
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Definition
| the real cost of an item: what you must give up in order to get it |
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Definition
| an economy in which industry is publicly owned and a central authority makes production and consumption decisions |
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Definition
| the advantage conferred by the ability to produce more of a good or service with a given amount of time and resources |
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Definition
| the rivalry among sellers trying to achieve such goals as increasing profits, market share, and sales volume by varying the elements of the marketing mix: price, product, distribution, and promotion. |
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Definition
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| the number of people who are either actively employed for pay or unemployed and actively looking for work; the sum of employment and unemployment |
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Definition
| all resources that come from nature, such a minerals, timber, and petroleum |
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Term
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Definition
| An individual who, rather than working as an employee, runs a small business and assumes all the risk and reward of a given business venture, idea, or good or service offered for sale. |
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Term
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Definition
| when bussiness activity reaches a temporary maximum with full employment and near capacity output. Unemployment is it's lowest |
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Term
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Definition
| describes a market or economy in which there is no way to make anyone better off without making at least one person worse off |
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Definition
| the branch of economics that is concerned with the overall ups and downs of the economy |
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Term
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Definition
| rewards or punishments that motivate particular choices |
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Term
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Definition
| an economy in which the decisions of individual producers and consumers largely determine what, how, and for whom to produce, with little govt involvement in the decisions |
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Term
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Definition
| a market in which there are many buyers and sellers of the same good or service, none of whom can influence the price at which the good or service is sold. |
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Term
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Definition
| two goods (often consumed together) for which a rise in the price of one of the goods leads to a decrease in the demand for the other good |
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Term
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Definition
| a simplified representation used to better understand a real-life situation |
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Term
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Definition
| the study of scarcity and choice |
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Term
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Definition
| the branch of economic analysis that makes prescriptions about the way the economy should work |
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Term
| Law of Increasing Opportunity Costs |
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Definition
| a principle that states that once all factors of production (land, labor, capital) are at maximum output and efficiency, producing more will cost more than average. As production increases, the opportunity cost does as well. |
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Term
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Definition
| the quantity of goods and services produced |
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Term
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Definition
| a shift of the supply curve, which changes the quantity supplied at any given price |
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Term
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Definition
| a rising in overall price level |
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Term
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Definition
| output and employment as expanding toward full-employment level. The unemployment rate is falling |
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Term
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Definition
| a very deep and prolonged downturn |
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Term
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Definition
| the branch of economic analysis that describes the way the economy actually works |
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Term
| Inefficiently high quality |
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Definition
| a form of inefficiency resulting from price floors in which sellers offer high quality goods at high prices, even though buyers would prefer lower quality at a lower price |
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Term
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Definition
| in short supply; when a resource is not available in sufficient quantities to satisfy all the various ways a society wants to use it |
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Term
| Production Possibilities Curve |
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Definition
| illustrates the trade offs facing an economy that produces only two goods; shows the maximum quantity of one good that can be produced for each possible quantity of another good produced |
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Term
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Definition
| a financial gain, especially the difference between the amount earned and the amount spent in buying, operating, or producing something. |
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Term
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Definition
| a period of economic downturn when output and employment are falling |
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Term
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Definition
| A monetary compensation (or remuneration, personnel expenses, labor) paid by an employer to an employee in exchange for work done. |
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Term
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Definition
| manufactured goods used to make other goods and services. |
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Term
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Definition
| the bottom of the recession period. Unemployment is at it's highest |
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Term
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Definition
| a graphical representation of the demand schedule. It shows the relationship between quantity demanded and price. |
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Term
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Definition
| (from a tax) the decrease in total surplus resulting from the tax, minus the tax revenues generated. |
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Term
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Definition
| a shift of the demand curve, which changes the quantity demanded at any given price. |
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Term
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Definition
| a good or service that is used to produce another good or service. |
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Term
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Definition
| each person specializes in the task that he or she is good at performing |
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Term
| Equilibrium Clearing Price |
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Definition
| the price of a good at which the quantity demanded of that good equals the quantity supplied of that good |
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Term
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Definition
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Term
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Definition
| the relative price of exports in terms of imports and is defined as the ratio of export prices to import prices. It can be interpreted as the amount of import goods an economy can purchase per unit of export goods. |
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Term
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Definition
| when the quantity of a good or service demanded exceeds the quantity supplied; occurs when the price is below its equilibrium level and is also known as excess demand |
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Term
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Definition
| the "law" that a higher price for a good or service, other things being equal, leads people to s demand a smaller quantity of that good or service. |
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Term
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Definition
| goods or services are bought and sold illegally- either because it is illegal to sell them at all or because the prices charged are legally prohibited by a price ceiling. |
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Term
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Definition
| an economic situation when no individual would be better off doing something different; a competitive market is in equilibrium when the price has moved to a level at which the quantity demanded of goods equals the quantity supplied of that good. |
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Term
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Definition
| a maximum price that sellers are allowed to charge for a good or service |
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Term
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Definition
| shows the relationship between the quantity supplied and the price |
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Term
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Definition
| when you give up something in order to have something else |
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Term
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Definition
| a legal floor on the hourly wage rate paid for a worker's labor |
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Term
| inefficiently low quality |
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Definition
| a form of inefficiency resulting from price ceilings in which sellers offer low quality goods at a low price even though buyers would prefer a higher quality at a higher price. |
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Term
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Definition
| when a rise in income decreases the demand for a good; usually considered less desirable then more expensive alternatives |
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Term
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Definition
| the "law" that, other things being equal, the price and quantity supplied of a good are positively related |
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Term
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Definition
| two goods for which a rise in the price of one of the goods leads to an increase in the demand for the other good |
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Term
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Definition
| when a rise in income increases the demand for a good; most goods are normal goods |
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Term
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Definition
| a group of buyers and sellers, where buyers determine the demand and sellers determine the supply, together with the means whereby they exchange their goods or services |
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Term
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Definition
| legal restrictions on how high or low a market price may go; typically take the form of either a price ceiling or a price floor. |
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Term
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Definition
| the quantity of a good bought and sold its equilibrium price |
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Term
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Definition
| an upper limit on the quantity of some good that can be bought or sold |
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Term
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Definition
| shows how much of a good service consumers will be willing and able to buy at different prices |
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Term
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Definition
| a form of inefficiency in which people expend money, effort, and time to cope with the shortages caused by the price ceiling or surpluses caused by the price floor |
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Term
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Definition
| the number of people who are actively looking for work but aren't currently employed |
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Term
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Definition
| shows how much of a good or service producers would supply at different prices |
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Term
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Definition
| the actual amount of a good or service people are willing to sell at some specific price |
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Term
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Definition
| when the quantity supplied of a good or service exceeds the quantity demanded; occurs when the price is above its equilibrium level and is also known as excess supply |
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Term
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Definition
| the actual amount of a good or service consumers are willing and able to buy at some specific price |
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