microexam 1 Flashcards
Economics is the study of
choices
econmoics is the social science concerned with how individuals,
institutions, and society make optimal choices under
conditions of
scarcity
the condition whereby the resources we use to produce
goods and services are limited relative to our wants for
them
scarcity
signal that tells producers what and how much to
produce; in a standard market transaction it is paid by the
consumer
price
the sacrifice associated with making a choice; in
a standard market transaction it is paid by the producer
cost
out-of-pocket, monetary payments
explicit cost
most valued option forgone
opportunity/implicit cost
types of resrouces
labor, capital, entrepreneurship, natural
We try to maximize our ______by using by using _______ decision
making
utility, marginal
the satisfaction a consumer obtains from the
consumption of a good or service consumption of a good or service
utility
additional; the change that results from an
additional unit
marginal
statements about economic behavior or the economy that enable prediction of the probable effects of or the economy that enable prediction of the probable effects of certain actions
economic principles
In ______markets, households markets, households demand goods and services goods and services
which are which are supplied by firms in exchange for money
product
in ______markets, firms markets, firms demand resources which are resources which are supplied
by households in exchange for money
resouce
the price of a good and the quantity demanded price of a good and the quantity demanded
are inversely related
law of demand
the number of units consumers are of units consumers are
willing to buy at a willing to buy at a specific price
quantity demanded
In QD, a change in the amount purchased caused by a change in price results
in a movement ALONG the curve
