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Echo midterm
economics midterm
54
Economics
Undergraduate 1
10/30/2012

Additional Economics Flashcards

 


 

Cards

Term

A situation in which unlimited wants exceed the limited resources available to fulfill those wants 

 
Definition

Scarcity

 
Term

The study of the choices people make to attain their goals, given their scarce resources.

 
Definition

Economics 

 
Term
A group of buyers and sellers of a good or service and the institution or arrangement by which they come together to trade 
Definition

Market 

 
Term

 

The idea that because of scarcity, producing more of one good or service means producing less of another good or service. 

 
Definition
 
 
Trade-off 
Term

The highest-valued alternative that must be given up to engage in an activity. 

 
Definition
Opportunity cost 
Term
Analysis concerned with what is.  
Definition

 

Positive analysis 
 
Term
Analysis concerned with what ought to be.  
Definition
normative analysis
Term
The study of how households and firms make choices, how they interact in markets, and how the government attempts to influence their choices.  
Definition
microeconomics
Term

The study of the economy as a whole, including topics such as inflation, unemployment, and economic growth 

 
Definition
macroeconomics
Term
practical application of a incention
Definition
innovation
Term
development of a new good or a new process for making a good
Definition
invention
Term

The processes a firm uses to turn inputs into outputs of goods and services

 
Definition
technology
Term
Any product that you can touch
Definition
goods
Term
Knowledge base products
Definition
services
Term
total amount recieved for selling a good or service
Definition
Revenue
Term

The inputs used to make goods and services

 
Definition
Factors of production
Term

Manufactured goods that are used to produce other goods and services 

 
Definition
Capital
Term
Definition
human capital
Term

The ability of the economy to increase the production of goods and services 

 
Definition
economic growth
Term
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. 
Definition

Absolute advantage

Term
The ability of an individual, a firm, or a country to produce a good or service at a lower opportunity cost than competitors. 
Definition
Comparative advantage
Term
A market for goods—such as computers—or services—such as medical treatment.
Definition
Product market
Term

A market for the factors of production, such as labor, capital, natural resources, and entrepreneurial ability 

 
Definition
Factor market
Term

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.

 
Definition
Free market
Term
A curve that shows the relationship between the price of a product and the quantity of the product demanded. 
Definition
Demand curve
Term
The rule that, holding everything else constant, when the price of a product falls, the quantity demanded of the product will increase, and when the price of a product rises, the quantity demanded of the product will decrease.
Definition
Law of demand
Term
The change in the quantity demanded of a good that results from a change in price, making the good more or less expensive relative to other goods that are substitutes.
Definition
Substitution effect
Term
The change in the quantity demanded of a good that results from the effect of a change in the good’s price on consumers’ purchasing power.
Definition
Income effect
Term

A good for which the demand increases as income rises and decreases as income falls. 

 
Definition
Normal good
Term

A good for which the demand increases as income falls and decreases as income rises.

 
Definition
Inferior good
Term

Goods and services that can be used for the same purpose 

 
Definition
Substitutes
Term

Goods and services that are used together 

 
Definition
Complements
Term
A curve that shows the relationship between the price of a product and the quantity of the product supplied. 
Definition

Supply curve

Term

The rule that, holding everything else constant, increases in price cause increases in the quantity supplied, and decreases in price cause decreases in the quantity supplied. 

 
Definition

Law of supply

Term
A situation in which quantity demanded equals quantity supplied.  
Definition
Market equilibrium
Term

A situation in which the quantity supplied is greater than the quantity demanded.

 
Definition
Surplus
Term
A situation in which the quantity demanded is greater than the quantity supplied. 
Definition
Shortage
Term
A legally determined maximum price that sellers may charge 
Definition
Price ceiling
Term

A legally determined minimum price that sellers may receive. 

 
Definition
Price floor
Term

A benefit or cost that affects someone who is not directly involved in the production or consumption of a good or service.

 
Definition
Externality
Term
The difference between the highest price a consumer is willing to pay for a good or service and the price the consumer actually pays. 
Definition

Consumer Surplus

Term

The additional benefit to a consumer from consuming one more unit of a good or service. .

 
Definition
Marginal benefit
Term

The additional cost to a firm of producing one more unit of a good or service. 

 
Definition
Marginal cost
Term
The difference between the lowest price a firm would be willing to accept for a good or service and the price it actually receives. 
Definition
Producer surplus
Term

The reduction in economic surplus resulting from a market not being in competitive equilibrium. 

 
Definition
Deadweight loss
Term

A market in which buying and selling take place at prices that violate government price regulations. 

 
Definition
Black market
Term

The cost borne by the producer of a good or service. 

 
Definition
Private cost
Term

The total cost of producing a good or service, including both the private cost and any external cost 

 
Definition
Social cost
Term

The benefit received by the consumer of a good or service 

 
Definition
Private benefit
Term

The total benefit from consuming a good or service, including both the private benefit and any external benefit 

 
Definition
Social benefit
Term
A situation in which the market fails to produce the efficient level of output. 
Definition
Market failure
Term

Government taxes and subsidies intended to bring about an efficient level of output in the presence of externalities. 

 
Definition
Pigovian taxes and subsidies
Term
An approach that involves the government imposing quantitative limits on the amount of pollution firms are allowed to emit or requiring firms to install specific pollution control devices.
Definition
Command-and-control approach
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