Economic Environment Flashcards
the study of how humans make decisions in the face of scarcity.
economics
exists when human wants for goods and services exceed the available supply.
scarcity
indicate what must be given up to obtain something that’s desired.
opportunity costs
work required to produce a good or service is separated into tasks performed by different workers
division of labor
when workers or firms focus on tasks for which they are well suited within the overall production process
specialization of labor
focuses on the actions of individual agents within the economy, like households, workers, and businesses
microeconomics
studies the economy as a whole. It focuses on goals such as growth in the standard of living, low unemployment, and low inflation
macroeconomics
when the average cost of producing each individual unit declines as total output increases
economics of sale