Chapter's 1&2
the study of how humans make decisions in
the face of scarcity.
What is Economics?
the amount of some good or service consumers are
willing and able to purchase at each price.
What is Demand?
the value of the output of all final goods and services produced within a country in a given year
What is GDP?
the period of rapid economic growth
from 1870 onward
What is Modern Economic Growth?
out of work and actively looking for a job
What is unemployed?
the branch of economics that focuses on
broad issues such as growth, unemployment, inflation, and trade
balance.
What is Macroeconomics?
at the existing price, quantity
supplied exceeds the quantity demanded.
What is Surplus?
when a country’s exports are larger than its
imports; calculated as exports – imports.
What is Trade Surplus?
the widespread use of power-driven
machinery and the economic and social changes that resulted in
the first half of the 1800
What is Industrial Revolution?
individuals who are employed in a job that
is below their skills.
What is underemployed?
shows how households and firms
interact in the goods and services market, and in the labor market.
What is the Circular Flow Diagram?
Latin phrase meaning “other things being
equal”
What is Ceteris Paribus?
Consumption + Investment + Government + Trade balance
What is GDP Equation?
when society increases the level of capital
per person
What is Capital Deepening?
unemployment closely tied to the
business cycle, like higher unemployment during a recession.
What is Cyclical Unemployment?
indicates what one must give up to obtain what
he or she desires.
What is Opportunity Cost?
Income
Changing tastes or preferences
Changes in the composition of the population
Price of substitute or complement changes
Changes in expectations about future
What is the Factors that shift demand?
output that is counted more than once as it
travels through the stages of production
What is Double Counting?
the value of what is produced per worker, or
per hour worked (sometimes called worker productivity)
What is Labor Productivity?
unemployment that occurs
because individuals lack skills valued by employers.
What is Structural Unemployment?
as a person receives more of a good, the additional (or marginal) utility from each additional unit of the good declines.
What is Law of diminishing marginal utility?
Natural conditions
Input prices
Technology
Government policies
What is Factors that affect Supply?
the GDP divided by the population.
What is GDP per Capita?
the process whereby a firm turns
economic inputs like labor, machinery, and raw materials into
outputs like goods and services that consumers use.
What is Production Function?
the unemployment rate that
would exist in a growing and healthy economy from the
combination of economic, social, and political factors that exist at
a given time.
What is Natural rate of unemployment?