Shared Flashcard Set

Details

Basic Economics Concepts
For the CLEP Microeconomics exam 8-14%
8
Economics
Undergraduate 1
01/03/2011

Additional Economics Flashcards

 


 

Cards

Term
Scarcity and its implications
Definition
[image]
Term

Scarcity

 


  • implication
  • difference from shortage

 

Definition
  • Implies choice due to scarce resources, and that there is competition and opportunity costs
  • scarcity-wants greater than resources available, shortage-quanity demanded> quantity
Term

Production Possibility Curve

[image]

  • What does it show?
  • What does it mean if the line is straight?
  • If it looks like above, what does it mean?
  • What does the shifts mean?
  • Where
Definition
  • shows tradeoffs and opportunity costs
  • if it is straight, opportunity cost is constant
  • if concave downward, opportunity cost changes
  • if production capacity increases or decreases due to newer resources or new technology, the curve will shift outward
  • efficient points lay on the curve
Term
Comparative Advantage
Definition
  • when a firm or country can produce a good at a lower opportunity costs than another
Term

Specialization and Trade

  • what causes it
  • examples of trade organizations
  • limits of trade
  • consumer surplus
  • producer surplus
Definition
  • when a firm has a comparative advantage in a product, they specialize in it
  • WTO, APEC, NAFTA
  • tariffs(decrease in consumer surplus and increase in producer surplus) and quotas (same with additional revenues for importers)
  • difference in price buyers pay from the maximum they would pay
  • difference between price received and the minimum price a seller would take[image]
Term
Economic Systems
Definition
  • way how society decides what, how, and for whom will be produced
  • think capitalism and socialism as examples
Term
Property Rights
Definition
  • important as an incentive for production
  • is the range of laws and regulations thT DEFINE THE RIGHTS FOR THE USE AND TRANSFER OF RESOURCES
Term
marginal analysis
Definition
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