FINAL Flashcards
Scarcity
We cannot have all we want of goods and services
Opportunity costs
What is forgone when I choices made
Secondary effects
The unintended result of choices, unplanned and often unforeseen
Efficiency
The absence of waste
Macro economics
Deals with choices that affect the whole country
Micro economics
Looks mainly at choices made by individuals in households and business firms
Economic profit
A reward for innovation
Normal profit
Zero economic profit, just enough to keep existing resources employed no more, no less
Law of demand
When things other than price and quantity stay the same, people still want
Law of supply
Other things staying the same, firms are willing and able to sell more goods or services at higher prices than at lower ones
Substitute
A good we can use in place of another product
Market power
The ability to influence the price of a product or resource
Types of gross domestic product
Real and nominal
Define GDP
Gross domestic product is the value of all goods and services produced in a year in a single country
Real
Accounting for changes over years
Nominal
The GDP as it is in the moment
Inflation
A general increase in prices and or fall in the purchasing power of money
Money
A neutral means of exchange
Protectionism
A set of ideas to justify restrictions on imports
Four types of resources
Land, labor, capital, entrepreneurial and managerial ability
What are the four types of economic system
Tradition, command, market, mixed
We cannot have all we want of goods and services
Scarcity
What is for gone when A choice is made
Opportunity costs
The unintended result of choices, unplanned and often on for seen
Secondary effects
The absence of waste
Efficiency
Deals with choices that affect the whole country
Macroeconomics
Looks mainly at choices made by individuals and households and a business firms
Microeconomics
A reward for innovation
Economic profit
Zero economic profit, just enough to keep existing resources employed and no more and no less
Normal profit
Other things staying the same, firms are willing and able to sell more goods or services at higher prices than at lower ones
Law of supply
A good we can use in place of another product
Substitute
The ability to influence the price of a product or resource
Market power
Real and nominal
Types of GDP
The value of all goods and services produced in a year in a single country
Gross domestic product
Accounting for changes over the years
Real GDP
The GDP as it is in the moment
Nominal GDP
A general increase in prices and or fall in the purchasing power of money
Inflation
A neutral means of exchange
Money
A set of ideas to justify restrictions on imports
Protectionism
