mad about macro
The ability to produce a particular good or service at a lower opportunity cost than prospective trading partners.
What is "comparative advantage"?
This term describes the measure for how "sensitive" a variable may be in accordance to change in another variable.
What is "elasticity"?
This economic system, advocated for by economist Adam Smith in The Wealth of Nations, indicates that resources are allocated primarily through the "invisible hand" of market forces, with little to no government intervention.
What is a "free-market economy"?
This type of market system features a predominant seller with high barriesr to entry.
What is a "monopoly"?
This term describes a consumer's satisfaction derived from consuming a good or service; it is also widely used to determine the value of a good or service.
What is "utility"?
Name a way to calculate a nation's total value of goods and services produced within a country's border in a given time period. (Formula preferred, but approach is also alright)
Acceptable answers: income approach, expenditure approach, C + I + G + Xn
Capital, entrepreneurship, land, and labor are all categories of this.
What are the "factors of production"?
This 20th century model assumes that there are sticky wages and prices in the short-run but adjustments in the long-run and that supply and demand are the driving forces behind production, pricing, and consumption.
What is "neoclassical economics"?
These type of costs describe foregone and opportunity costs that are not explicitly known.
What are "implicit costs"?
This term describes a "side-effect" or consequence to an uninvolved third party as result of another party's/parties' activity.
What is an "externality"?
What is the term for the government's use of taxation and government spending to influence the economy?
What is "fiscal policy"?
This concept claims that if individuals have access to a public resource, they will exploit it without consideration for the common good. (Ex: public parks, overfished oceans)
What is the "tragedy of the commons"?
This famous economist, also known as the founder of macroeconomics, suggested that the government should increase spending during economic downturns to stimulate demand and reduce unemployment.
Who is "John Maynard Keynes"?
Market system in which there are many firms selling similar, but not identical products.
What is "monopolistic competition"?
This is the term for the rate at which the general price level of goods and services is rising and subsequently, purchasing power is falling.
What is "inflation"?
This monetary policy action involves the purchase of securities (i.e. bonds) by central banks, such as the Federal Reserve, for the purpose of reducing interest rates and increasing the money supply.
What is quantitative easing (acceptable: open market operations)?
In game theory, what is the name of the strategy that, once adopted by a player, is considered his "best option", given the strategies of other players?
What is a "Nash Equilibrium"?
This economic philosophy, associated with Friedrich Hayek and the idea of limited government intervention in markets, emphasizes the importance of individual freedom and competition.
What is "classical liberalism" (Also acceptable: laissez-faire economics)?
This describes a firm's short-run decision to cease production.
What is a "shutdown"?
This term is used to describe a period of persistent high inflation combined with high unemployment and stagnant demand.
What is "stagflation"?
This account in a country's balance of payments focuses on foreign-owned assets and capital transfers.
What is the "financial and capital account"?
This pricing tactic, perhaps used in oligopolistic systems, involves covert collusion based on tacit understandings.
What is "collusive pricing" or price-fixing? Also acceptable: joint profit maximization.
What concept in economic growth theory, named after an economist, suggests that economic growth can be sustained through the accumulation of physical and human capital, as well as technological progress?
What is "Solow's growth model" or "Solow's growth theory"?
The market system in which there is a predominant buyer. An example of this market system is the jobs market.
What is a "monopsony"?
This term is an indicator that is used to measure income/wealth inequality, in which zero indicates perfect equality and one indicating absolute inequality.
What is the "Gini coefficient"?