1.1 & 1.2
Land, Labor, Capital, and Entrepreneurship
What are the factors of production?
Gains from trade are based on this.
What is specialization?
What is the Law of Demand?
The relationship between P & Q under the law of supply.
What is a direct relationship?
An economic situation in which no one would be better off doing something different.
What is equilibrium?
This model shows trade-offs and illustrates opportunity costs, efficiency, and economic growth.
What is a production possibilities curve or frontier?
This is the ability to make more of a good or make it with fewer resources than anyone else.
What is Absolute Advantage?
The movement along the demand curve demonstrates this.
Rising wages of workers cause the supply curve to shift________, a new technology that increases efficiency causes the supply curve to shift ______.
What is left and right?
What the market moves towards.
What is price equilibrium (Pe) ?
Two ways to describe economics
What are positive and normative?
This means you can make a good or service at a lower opportunity cost than everyone else.
What is Comparative Advantage?
The factors that cause a change in demand at every price level.
What are tastes, related goods, income, buyers, and expectations?
Oil and natural gas are considered this.
What are Compliment goods in production?
When the price is ABOVE the market clearing price, we have a ________, and this pushes the price ______.
What is a surplus and down?
The two reasons for economic growth, as demonstrated in the PPC
What are technology and an increase in resources?
This is found between one country's opportunity cost for producing a good and another country's opportunity cost of producing the same good.
What are beneficial terms of trade?
An increase in income causes demand for _______ to go up and _______ to go down.
What are normal goods and inferior goods?
Because they are related goods, an increase in the cost of AirPods would cause a decrease in the supply of this.
What are AirPod cases? Answers may vary as long as they are related goods.
Decreases the Equilibrium Price (EP) and Equilibrium Quantity (EQ).
What is a DECREASE in demand?
This impact is demonstrated on Sudan's PPC after 18 brutal months of war.
What is an inward shift?
The way that specialization and trade show up on each trading country's PPC.
What is a point beyond a country's PPC?
Three changes that shift the demand curve left.
What are something isn't cool, substitute goods get cheap, fewer buyers, and prices are expected to drop next month.
What are input prices, prices of related goods, expectations, number of suppliers, and technology?
Simultaneous shifts that cause us to know the new Ep, but not the new Eq
What are shifts in the opposite direction?