Chapter 3 Flashcards
1
Q
Free lunch
A
Getting something without giving up something else
2
Q
Slope
A
Measures opportunity cost - steeper, greater the cost
3
Q
Allocative efficiency
A
A situation in which the quantities of goods and services produced are those that people value more highly
4
Q
PPF vs Marginal benefit
A
PPF: feasible
Marginal Benefit: desirable
5
Q
Economic growth
A
Consumption must decrease
6
Q
Comparative advantage
A
The ability of a person to perform an activity or produce a good or service at a lower opportunity cost than someone else
7
Q
Absolute advantage
A
When one person is more productive than another person in several or all activities
8
Q
Tradeoff
A
Giving up one thing to get another
