intro to economics [topic 1]
The study of how individuals, firms, and governments make decisions to allocate limited resources to satisfy unlimited wants.
Economics
A person who uses goods and services to satisfy their needs and wants.
Consumer
type of market structure that is characterized by a large number of firms selling similar but not identical products.
Monopolistic competition
Institutions that facilitate the borrowing and lending of funds between savers and borrowers are part of this market.
Financial markets
A type of government policy that involves adjusting taxation and government spending to influence the economy.
Fiscal policy
The next best alternative foregone when a decision is made.
Opportunity Cost
In microeconomics, when firms try to maximize the difference between total revenue and total costs, they are trying to achieve this.
Profit maximisation
When the price of a good rises, the quantity supplied rises, and when the price falls, the quantity supplied falls. What law is this.
Law of Supply
The proportion of an individual's income that is not spent on consumption but instead put aside for future use.
Savings
A government payment to encourage or support an industry or sector, often used to make certain goods or services cheaper for consumers.
Subsidy
In economics, this refers to a graphical model that shows all combinations of two goods that a country can produce given its resources and technology.
Production Possibility Frontier [PPF]
A long-term increase in a firm's scale of production leads to lower average costs of production. What is this called?
Economies of Scale
A market failure occurs when the free market does not lead to an efficient allocation of resources. One common form of market failure occurs when the consumption or production of a good affects third parties. What is this called?
Externalities
The RBA's policy of adjusting interest rates and influencing money supply in order to control inflation and achieve economic stability.
Monetary Policy
A tax system where higher income individuals pay a larger proportion of their income in taxes." What type of tax is this?
Progressive tax
When the economy operates at a point on its production possibility curve, meaning it’s using all of its resources efficiently
productive efficiency
A measure of the responsiveness of the quantity demanded of a good to a change in its price is known as?
Price elasticity of demand
The total demand for labour in an economy at various wage rates, which is downward-sloping due to the law of diminishing returns.
Aggregate demand