unit 1 Flashcards
(21 cards)
cost
require the payment of (a specified sum of money) before it can be acquired or done.
economics
The study of how people seek to satisfy their needs and wants by making choices
microeconomics
the study of the economic behavior and decision making of small units, such as individuals, families, and businesses
macroeconomics
the study of economy-wide phenomena, including inflation, unemployment, and economic growth
scarcity
A situation in which unlimited wants exceed the limited resources available to fulfill those wants
utility
Ability or capacity of a good or service to be useful and give satisfaction to someone.
opportunity cost
cost of the loss of the next most desireable good or service that could have been produced with a recource
absolute advantage
the ability to produce a good using fewer inputs than another producer
cost benefit analysis
a way of thinking about a problem that compares the costs of an action to the benifits recieved
sunk cost
A cost that has already been incurred and that cannot be changed by any decision made now or in the future.
marginal thinking
requires decision-makers to evaluate whether the benefit of one more unit of something is greater than its cost
productivity
The value of a particular product compared to the amount of labor needed to make it.
trade
Exchange of goods and services
specialization
the concentration of the productive efforts of individuals and firms on a limited number of activities
comparative advantage
the ability to produce a good at a lower opportunity cost than another producer
marginal cost
the cost of producing one more unit of a good
marginal benefit
the additional or extra benefit associated with an action
rule of law
the restriction of the arbitrary exercise of power by subordinating it to well-defined and established laws.
markets
Bring buyers and sellers together to exchange goods and services
innovations
A new method, idea, or product
economic growth
the ability of the economy to increase the production of goods and services
