Applied Economics Flashcards
What is economics
Management of scarce resources
- Production, distribution, and consumption
Needs
Essential to human survival
Wants
Desired but not essential to survival
Opportunity Cost
giving up an alternative for the best option
Economic development
process of growth in the economy
Applied Economics
Application of ec to irl situations
Rational Choice Theory
choosing the option that gives you the most advantages
What is the use of a GPD
Measures level of production within the nation
What is the use of a GNP
The total value of all the finished goods produced by a country’s citizens
What does GPD stand for
Gross domestic production
What does GNP stand for
Gross National Product
Poverty
the population is only able to meet basic needs
Factors of poverty
- Inequality
- overpopulation
- Unemployment
Absolute poverty
Deprivation of basic needs
PH minimum wage
516
Frictional
In between jobs
Cyclical
changes in the economy which leads to unemployment ( inflation)
Seasonal
Certain times during the year ( farmers)
Structural
Changes in the economy, and mismatch between skills in the workplace
Inflation
Continuous price increase
What is used for measuring inflation
CPI
CPI
consumer price index
What is Elasticity
change in the demand for goods/ service
Elastic
An increase in price is less than a decrease in demand
Inelastic
An increase in price is greater than a decrease in demand
Unitary Elastic
An increase in price that is equal to an increase of demand
Equilibrium
center balanced ( center point in the graph)
Shortage
price low, demand high
Surplus
price high, demand low
What is the Market
Place where buyers and sellers make transactions
Perfect competition
All products are identical
multiple sellers and buyers
Easy entry
is the market physical or digital
Ant
Monopoly
single seller
Oligopoly
Products are almost similar
Entry to market: collusion
What do you call a single seller
Monopolist
Monopolistic competition
Monopoly + Perfect competition
