Graphs
Where the quantity of a product is listed on a graph.
What is the bottom?
Getting the most benefit from scarce resources.
What is Economic Efficiency?
The relationship between price and quantity supplied.
What is the Law of Supply and Demand?
A product whose demand rises when income rises, and vice versa.
What is a Normal Good?
What is Elasticity?
Where the price of a product is listed on a graph.
What is the left?
When one country can produce a good at a lower opportunity cost than another country.
What is Comparative Advantage?
Not enough resources to produce everyone's wants.
What is Scarcity?
A product whose demand falls when income rises and vice versa.
What is an Inferior Good?
Where the elasticity of an item is less than one.
The direction of the shift a shortage in the supply of an item causes.
What is left
What one must give up to obtain what he or she desires.
What is Opportunity Cost?
The point where the supply curve (S) and the demand cure (D) cross.
What is Equilibrium?
A good or service that we can use in place of another good or service.
What is a Substitute Good?
Occurs when a price change of 1% results in a quantity change of 1%.
What is Unitary Elasticity?
A relationship between two, and only two, variables when all other variables are kept constant.
What is a demand or supply curve?
All the combinations of goods a person can afford, given the price of the goods and their budget.
What is Budget Constraint?
The quantity supplied exceeds the quantity demanded.
What is Surplus or Excess Supply?
Goods often used together because consumption of one good tends to enhance consumption of the other.
What are Complement Goods?
The extreme case where the quantity demanded (Qd) or supplied (Qs) changes by an infinite amount in response to any change in price.
What is Perfectly Elastic?
Displays the production options that are possible or even impossible for an economy.
Adam Smith's concept that individuals' self-interested behavior can lead to positive social outcomes.
What is Invisible Hand?
The assumption behind a supply or demand curve that no relevant factors, other than the product's price, is changing.
What is the Ceteris Paribus Assumption?
A combination of labor, materials, and machinery to produce goods or services.
What is Input?
The extreme case in which a percentage change in price, no matter how large, results in zero change in quantity.
What is Perfectly Inelastic?