Intro to Economics 1
Physical thing with a limited lifespan.
What is a good?
The study of economic decisions made by individual people
What is microeconomics?
Graph showing the maximum number of goods a company or country can produce with their limited resources
What is a production possibilities curve (PPC)?
Point at which the amount of units a firm is willing to produce is equal to the amount of units buyers demand and a single price point
What is the market equilibrium point?
What is a surplus?
The study of economic choices made at a large scale
What is macroeconomics?
Branch of economics where economists make observations about present and past economic behavior, then predict what will happen next
What is positive economics?
Factor of production that includes the human effort that goes into making a good.
What is labor?
Occurs when demand is greater than supply.
What is a shortage?
The willingness of consumers to buy a good at all price points.
What is demand?
Non-physical thing, the work people do for others
What is a service?
Approach to economics that is value or opinion based.
What is normative economics?
Maximizing the usage of limited resources to satisfy as many wants as possible
What is economic efficiency?
The willingness of consumers to buy a good at a single price point.
What is quantity demanded?
The amount of goods and services business firms are willing and able to provide at a single price point
What is quantity supplied?
An object's value comes from how much people are willing to pay for it
What is subjective value theory?
The idea that the value of goods and services come from the nature of the goods and services themselves
What is intrinsic value theory?
Factor of production that includes the natural resources that go into producing a good.
What is land?
The amount of goods and services a business firm is willing and able to produce at any price point.
What is supply?
When someone wants a job, but hasn't found one.
What is unemployment?
Economists make opinion-based claims about which economic decisions should be made (focus on what ought to be)
What is normative economics?
Approach to economics not based on values or opinion.
What is positive economics?
Economic model that shows how money moves around an entire economy
What is a circular flow model?
The law that as people consume more units of a good or service, the total satisfaction derived from each additional unit decreases.
What is the law of diminishing marginal utility?
What is price?