Basic Terms
How People Make Decisions
How People's Choices Interact
How the Whole Economy Works
Wildcard
100
Term for anything used to produce goods and services (includes land, labor, and capital)
What are resources
100
Term for the situation when society gets the most from its scarce resources
What is efficiency
100
Term for a group of buyers and sellers (not a place)
What is a market
100
Increasing general price level of goods and services
What is inflation?
100
Term for something that induces a person to act (i.e. the prospect of a reward or punishment)
What is an incentive
200
The term for the limited nature of society's resources (land, labor, and physical capital)
What is scarcity
200
Term for when prosperity is distributed uniformly among society members
What is equality
200
A type of economy that allocates resources through the decentralized decisions of many households and firms as they interact in markets
What is a market economy?
200
Characterized by extended periods of high unemployment
What is a recession?
200
When countries spend money on defense services, parks, roads, etc. they are spending on...
What are public goods
300
Term for the study of how society manages its scarce resources
What is economics
300
Term for whatever must be given up to obtain an item
What is the opportunity cost
300
Term for when the market fails to allocate society's resources efficiently
What is market failure
300
This is a recent example of when the government spent lots of money to try to bring the American economy out of a recession
What is the 2008 stimulus package
300
The branch of economics concerned with how people make decisions and how these decisions interact
What is microeconomics
400
Term used for decision of students whether to buy groceries or buy textbooks. Farmers face them, students face them, governments face them, etc.
What are tradeoffs
400
Term for incremental adjustments to an existing plan
What is marginal changes
400
Term for when the production or consumption of a good affects bystanders (e.g. pollution)
What are externalities
400
Occurs when governments print large amounts of money at a time
What is inflation
400
Branch of economics concerned with the overall economy
What is macroeconomics
500
Term for the artificial state when price is too low (ex: gas in 1973 when government put a maximum price you could charge for gas)
What is a shortage
500
Term for a cost already incurred that cannot be recovered, and therefore, a rational person does not include these in making decisions
What is a sunk cost
500
When a single buyer or seller has substantial influence on market price (e.g. monopoly)
What is market power
500
For the economy as a whole, total spending is equivalent to...
What is the total income or total value of output produced
500
Economics is this type of science
What is a social science?
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