Introduction to econ Flashcards
(29 cards)
What is scarcity?
Inability to satisfy all wants universally
Scarcity is a fundamental concept in economics that indicates limited resources relative to unlimited wants.
What is microeconomics?
Study of individual and business choices
Microeconomics focuses on the behavior of individuals and firms in making decisions regarding the allocation of scarce resources.
What is macroeconomics?
Study of national and global economic performance
Macroeconomics examines overall economic systems and large-scale economic factors such as growth, inflation, and unemployment.
What are incentives?
Actions that influence choices through rewards or penalties
Incentives can be positive (rewards) or negative (penalties) and are crucial in understanding decision-making processes.
Fill in the blank: __________ is the study of individual and business choices.
[microeconomics]
Fill in the blank: __________ refers to the inability to satisfy all wants universally.
[scarcity]
True or False: Macroeconomics focuses on small-scale economic factors.
False
Macroeconomics deals with large-scale economic factors, unlike microeconomics.
What does the study of economic choices involve?
Analyzing decisions made by individuals and businesses regarding resource allocation
Economic choices are influenced by scarcity, incentives, and available information.
What are economic choices?
Decisions made to allocate limited resources.
Economic choices involve prioritizing certain needs and wants over others due to scarcity.
Define production in economic terms.
Creation of goods and services to satisfy wants.
Production is essential for fulfilling consumer demands in an economy.
What are the factors of production?
Resources used to produce goods:
* land
* labor
* capital
Each factor plays a crucial role in the production process, contributing to the overall economy.
What are taxes?
Government levies that reduce disposable income.
Taxes are essential for funding public services and infrastructure.
What is the definition of Demand?
Desire for goods and services at various prices.
Demand reflects consumer willingness to purchase at different price levels.
What does Supply refer to?
Amount of goods available for sale at various prices.
Supply indicates the quantity of a product that producers are willing to sell at different price points.
What is Market Equilibrium?
Point where supply equals demand.
At this point, the market is stable, with no excess supply or demand.
Define Opportunity Cost.
Value of the next best alternative forgone.
Opportunity cost is a key concept in economics that highlights the trade-offs involved in decision-making.
What are the methods societies use to allocate resources called?
Economic Systems
What are tangible products that satisfy wants known as?
Goods
What are intangible activities that satisfy wants referred to as?
Services
What does government spending on military and protection refer to?
National Defense
The measure of the percentage of the labor force that is unemployed is known as the _______.
Unemployment Rate
What is the Unemployment Rate?
Percentage of labor force without jobs.
Unemployment rate is a key economic indicator used to gauge the health of the labor market.
What are Interest Rates?
Cost of borrowing money, influences economic activity.
Interest rates affect consumer spending and investment decisions.
Define Global Economy.
Economic interactions among countries worldwide.
The global economy encompasses trade, investment, and economic policies across nations.
