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djk micro midterm Flashcards

(86 cards)

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1
Q

Scarcity

A

The fundamental problem of having limited resources to meet unlimited wants.

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2
Q

Price Floor

A

A minimum price set by the government above the equilibrium price.

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3
Q

Price Ceiling

A

A maximum price set by the government below the equilibrium price.

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4
Q

Allocative efficiency

A

Producing the right mix of goods, according to consumer preferences.

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5
Q

Productive efficiency

A

Producing goods in the least costly way.

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6
Q

Shortage

A

When quantity demanded exceeds quantity supplied.

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7
Q

Surplus

A

When quantity supplied exceeds quantity demanded.

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8
Q

Equilibrium Quantity

A

The quantity at which quantity supplied equals quantity demanded.

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9
Q

Equilibrium Price

A

The price at which quantity supplied equals quantity demanded.

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10
Q

Change in quantity supplied

A

Movement along the supply curve due to a price change.

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11
Q

Change in supply

A

A shift in the supply curve due to factors other than price.

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12
Q

Determinants of Supply

A

Factors other than price that affect supply (e.g., technology, resource prices).

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13
Q

Supply Curve

A

A graphical representation of the relationship between price and quantity supplied.

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14
Q

Law of Supply

A

As the price of a good rises, the quantity supplied increases, ceteris paribus.

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15
Q

Supply schedule

A

A table showing the quantity supplied at various prices.

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16
Q

Supply

A

The quantity of a good that producers are willing and able to sell at various prices.

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17
Q

Change in quantity demanded

A

Movement along the demand curve due to a price change.

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18
Q

Change in demand

A

A shift in the demand curve due to factors other than price.

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19
Q

Complementary Goods

A

Goods that are consumed together.

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20
Q

Substitute Goods

A

Goods that can be used in place of each other.

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21
Q

Inferioe Goods

A

Goods for which demand decreases as income rises.

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22
Q

Normal Goods

A

Goods for which demand increases as income rises.

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23
Q

Determinants of Demand

A

Factors other than price that affect demand (e.g., income, tastes).

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24
Q

Demand Curve

A

A graphical representation of the relationship between price and quantity demanded.

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25
Substitution effect
As the price of a good falls, it becomes more attractive relative to substitutes, increasing the quantity demanded.
26
Income Effect
As the price of a good falls, the consumer’s purchasing power increases, leading to higher quantity demanded.
27
Diminishing Marginal Utility
As more units of a good are consumed, the additional satisfaction from consuming one more unit declines.
28
Law of Demand
As the price of a good rises, the quantity demanded falls, ceteris paribus.
29
Demand Schedule
A table showing the quantity demanded at various prices.
30
Demand
The quantity of a good or service that consumers are willing and able to purchase at various prices.
31
Residual Claimant
The individual or entity entitled to the remaining income after all expenses are paid.
32
Resource Market
Where resources (like labor and capital) are bought and sold.
33
Product Market
Where goods and services are bought and sold.
34
Corporation
A business that is a separate legal entity from its owners.
35
Partnership
A business owned by two or more people.
36
Sole Proprietorship
A business owned and operated by one person.
37
Businesses
Organizations that buy resources to produce and sell goods and services.
38
Households
Individuals or groups who provide resources and purchase goods and services.
39
Circular Flow Diagram
A model showing the flow of goods, services, and money between households and businesses.
40
Invisible Hand
A metaphor for the self-regulating nature of markets.
41
Creative Destruction
The process by which new products and methods replace old ones.
42
Dollar Votes
When consumers spend money, they effectively “vote” for the production of certain goods
43
consumer sovreignty
The concept that consumers decide what goods and services will be produced.
44
Money
A commonly accepted medium of exchange.
45
Barter
The exchange of goods and services without money.
46
Medium of Exchange
Anything widely accepted in exchange for goods and services (e.g., money).
47
Division of Labor
Splitting production processes into different tasks to increase efficiency.
48
Specialization
The focus of a business or individual on producing one or a few goods efficiently.
49
Market
A mechanism that brings buyers and sellers together.
50
competition
The rivalry among sellers in a market
51
Self-Interest
Individuals' pursuit of personal benefit, driving economic decisions.
52
Freedom of Choice
The freedom of consumers to buy what they want.
53
Freedom of Enterprise
The ability of businesses to obtain resources and sell products freely.
54
Private Property:
The right to own and control resources and products.
55
Market System
An economic system where decisions are made by individuals and firms interacting in markets
56
Command System
An economic system in which the government controls resources and production decisions.
57
Laissez-Faire Capitalism
An economic system with minimal government intervention.
58
Economic System
The way a society organizes the production, distribution, and consumption of goods.
59
Economic Growth
The expansion of the economy’s capacity to produce goods and services over time.
60
Law of Increasing Opportunity Costs
As production of one good increases, the opportunity cost of producing an additional unit rises.
61
Production Possibilities Curve (PPC
A graph that shows the combinations of two goods that an economy can produce, given its resources
62
Capital Goods
Goods used to produce other goods (e.g., machinery, factories).
63
Consumer Goods:
Goods used by individuals for personal satisfaction.
64
Factors of Production:
Land, labor, capital, and entrepreneurial ability.
65
Entrepreneurs
Individuals who use entrepreneurial ability to bring resources together to produce goods and services.
66
Entrepreneurial Ability
The ability to combine other resources, take risks, and innovate.
67
Investment
The act of purchasing capital goods to increase future production.
68
Captial
Manufactured goods used to produce other goods and services (factories, machinery).
69
Labor
Human effort used in production of goods and servicesC
70
Land
Natural resources used in production
71
Economic Resources
The inputs used to produce goods and services, categorized as land, labor, capital, and entrepreneurial ability.
72
Budget Line
A graph showing all combinations of goods that can be purchased with a given budget
73
Economizing Problem
The need to make choices because economic wants exceed available resources
74
Normative Economics
Value judgments about what the economy should be like. Political mostly.
75
Positive Economics
Objective analysis and facts
76
Aggregate
A total or sum of individual parts, often used in macroeconomics to refer to total outputs or total demand.
77
Macroeconomics
The study of the overall economy, including inflation, unemployment, and economic growth.
78
CETERIS PARIBUS
The assumption that factors other than those being considered do not change.
79
Microeconomics
The study of individual consumers, firms, and markets.
80
Economic Principle
A widely accepted generalization about economic behavior or the economy.
81
Scientific Method
A systematic process of hypothesis formulation, testing, and refinement in economics
82
Marginal Analysis
Comparing the additional benefits and additional costs of a decision.
83
Utility
The satisfaction or benefit gained from consuming a good or service.
84
Opportunity cost
The value of the next best alternative that must be forgone when making a choice.
85
Economic Perspective
A way of thinking that considers scarcity, opportunity costs, and rational behavior to make decisions
86
Economics
The study of how individuals and societies allocate limited resources to satisfy unlimited wants

djk (5 decks)

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