Econ basics Flashcards
(22 cards)
what are the factors of production that causes scarcity (3)
- labour
-natural resource
-manufactured resource
what is scarcity
a cond when potential demands>potential supplies
what is macro related to
balance between agrregates
whats inflation
higher price
what time frame is used to calc rate of inflation
one yr
what’s trade deficit
import>export
what happens when agg demand<supply (2)
- unemployment
-recession
what’s recession
econ output declines for more than 6 mth
what’s the main macro policy
balancing the aggregates
2 types of macro policies
- demand-side policy
- supply side policy
trade-off definition
making one good is the loss of another
3 micro questions
- produce what
- how produced
- for whom produced
oppor cost definition
the cost of any activities measured in terms of the best alternative forgone
what the relationship between marginal benefit and marginal cost should be like
marginal benefit> marginal cost
2 types of efficiencies
-economic
-allocative
3 types of efficiency in econ
- production
- consumption
- specialisation & exchange
desc the production possibility curve (PPC)
- limit of production due to limitted resources
- inside the curve, production inefficiency
- on the curve, production efficiency
- go up the curve,more production
- go down the curve, less production
what happens when ppc is a straight line
constant OC
what happens when curve bowed towards origin for ppc
less oc
investment definition
the production of items that arent for immediate consumption
barter economy meaning
people exchange goods and services w no money
market meaning
interaction between buyer and seller
