Key Terms
What is economics?
This type of economics looks at the broader economy
What is macroeconomics?
The law of demand states that as the price of a good or service rises, demand ________.
What is decreases?
What is the Fed?
This is what the government does to control the economy
What is fiscal policy?
Basic requirements for survival
What is a need?
This is what you lose when you make a decision
What is opportunity cost?
Producers are willing to sell _____ or a good/service at higher prices.
What is more?
These are the duties of the Fed (only have to name one)
What is assuring stability, holding reserves, lending money?
This is what the Fed does to control the economy.
What is monetary policy.
Desires that can be satisfied by consuming a good or a service
What is a want?
This refers to all the natural resources needed to produce a good or a service
What is land?
This is a graph that depicts a supply schedule.
What is a supply curve?
This is the term for the percentage of money that a bank must hold in its reserves
What is the required reserve ratio (RRR)?
This occurs when general price levels drop
What is deflation?
This exists when we do not have enough resources to produce all the things that we want
What is scarcity?
This term refers to an economic system where private citizens own and use the factors of production to seek a profit
What is capitalism/market economy/free enterprise system?
This is a table that shows how much of good/service consumer is willing to buy at each price in the market
What is a demand schedule?
This refers to the Fed's effort to increase the money supply.
What is expansionary policy?
This is the total value, in dollars, of all final goods and services produced in country in single year
What is Gross Domestic Product (GDP)?
Adam Smith says that this is what ultimately guides the market
What is the "invisible hand"?
This term refers to someone that is willing to start a business and risk loss in order to make money
What is an entrepreneur?
This terms refers to how the marginal benefit from using each additional unit of good or service during given time period declines as each is used
What is the law of diminishing marginal utility/the law of diminishing returns?
This refers to the Fed's plan to decrease the money supply.
What is contractionary policy?
These are goods that can be consumed by one person without preventing the consumption of a good by another
What are public goods?