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Resources
Production Possibility
Comparative Advantage
Supply and Demand
S/D Shifters and Price/Quantity Change
100

Mrs. Jackson teaching

Labor

100

The second best choice you gave up when you chose the first best choice.

Opportunity Cost

100

When one country is better at making a product than another.

Absolute Advantage.

100

Consumers want to buy as much as they can for as little money as possible (inverse relationship)

Law of Demand

100

Cattle gets cheaper. The supply of steak...

Increases (shift right)...

200

Tractor on Farm

Capital

200

When an economy operates inside the PPC/PPF.

Inefficiency or Underemployment

200

The ability of an economy to produce a good at a lower opportunity cost than another country.

Comparative Advantage.

200

Producers want to produce as much as they can and sell it for as much money as they can (direct relationship)

Law of Supply

200

Lebron James releases a new shoe. After winning the NBA Finals the demand for the shoe...

Increases (Shifts Right)

300

Phil Knight (Creator of Nike)

Entrepreneurship

300

Any point outside the PPC/PPF

Unattainable

300
United States: 500 bushels of corn Mexico: 400 bushels of corn Absolute Advantage.
What is the United States?
300

As price goes up, so does quantity.

Supply

300

Supply shifts left and Demand shifts right.

Price Increases

400

Learning how to bake a fluffier croissant

Human Capital

400

This means that the more you have of something, the less utility [satisfaction] you get from each new unit.

Diminishing Marginal Utility

400

United States: 100 cars 200 tomatoes

France: 90 cars 100 tomatoes

Comparative Advantage for Cars

France

400

Quantity Supplied is at 300 units. Quantity Demanded is at 200 Units.

What exists?

Surplus

400

Demand Shifts Left and Supply Shifts Left

Price remains the same.

500

The Rainforest

Land

500

As production of a product increases, the cost to produce an additional unit of that product increases as well.

The Law of Increasing Opportunity Costs

500

Using the same amount of time and resources, Tomer can either write 100 lines of code or process 20 reports, and Charlotte can either write 120 lines of code or process 20 reports.

Which of these terms of trade will Charlotte and Tomer agree on if they specialize and trade?

1 line of code = 0.18 of a report

500

The point where quantity supplied and quantity demanded meet.

Equilibrium Quantity

500

An increase in the demand for bread following a very harsh winter changes the price of bread...

The price of bread increases.