Chapter 1 Terms Flashcards
1
Q
Economics
A
- The study of the choices that individuals and societies make in the production, distribution, and consumption of goods
2
Q
Economy
A
- Any system for the production, distribution, and consumption of goods
3
Q
Economists
A
- Scholars of the production, distribution, and consumption of goods within an economy
4
Q
Macroeconomics
A
- The study of national and international economies and how these major economies are affected by large-scale choices and public policies
5
Q
Microeconomics
A
- The study of specific components within a major economy and how the choices made by individuals, households, and businesses affect that economy
6
Q
Economic Models
A
- Seek to show the relationships among the various components of an economy
7
Q
Economic Forecast
A
- Seeks to help those making decisions to make wise decisions
8
Q
Good
A
- A tangible item that people want and for which they will pay
9
Q
Services
A
- Intangible goods produced by labor for which people expect to pay
10
Q
Want
A
- The human desire to have and use a certain good
11
Q
Market
A
- A mechanism that allows people to exchange goods
12
Q
Mass Market
A
- A very large number of people to whom very large quantities of products are sold
13
Q
Supply
A
- The quantity of a good for sale at a certain price under certain conditions
- The amount of a good that is produced
14
Q
Demand
A
- The amount of a good that is bought at a certain price under certain conditions
15
Q
What is the first thing to understand about economics?
A
- All goods have to be worked for
16
Q
Producers
A
- Provide goods
17
Q
Consumers
A
- Use goods
18
Q
Prodigality
A
- The bad habit of spending more than one can afford
19
Q
Need
A
- A necessity
20
Q
Want
A
- A desire, a longing, an appetite for something
21
Q
Capital Good, Investment Good, or Capital
A
- Anything used in the production and distribution of goods and services
22
Q
Consumer Goods
A
- Things produced for direct use by consumers
23
Q
Technology
A
- The industrial skills and scientific methods that make possible efficient production
24
Q
Utility
A
- Usefulness
25
Scarcity
- Limited availability
26
Who was the founder of the Austrian School of Economics who also came up with the solution to the Diamond-Water Paradox?
- Carl Menger
27
Diamond-Water Paradox
- Asked why rare items such as diamonds normally command high prices while necessities such as water usually command low prices
28
Value
- The worth that consumers attach to a good
29
Is money considered to be capital?
- No
