Economics Terminology: Scarcity, Efficiency, Markets, and Macro-Micro Concepts, Quizzes of Economics

Download Economics Terminology: Scarcity, Efficiency, Markets, and Macro-Micro Concepts and more Quizzes Economics in PDF only on Docsity! TERM 1 Scarcity DEFINITION 1 The limited nature of society's resources TERM 2 economics DEFINITION 2 the study of how society manages its scarce resources TERM 3 efficiency DEFINITION 3 the property of society getting te most it can from its scarce resources TERM 4 Equality DEFINITION 4 the property of distributing economic properity uniformly among the members of society TERM 5 Opportunity Cost DEFINITION 5 whatever must be given up to obtain some item TERM 6 rational people DEFINITION 6 people who systematically and purposfully do the best they can to achieve their objectives TERM 7 marginal changes DEFINITION 7 small incremental adjustments to a plan TERM 8 incentives DEFINITION 8 something that induces a person to act TERM 9 property rights DEFINITION 9 the ability of an individual to own and exercise control over scarce resources TERM 10 market failure DEFINITION 10 a situation in which a market left on its own fails to allocate resources efficiently TERM 21 Normative Statement DEFINITION 21 Claims that attempt to prescribe how the world should be TERM 22 Absolute Advantage DEFINITION 22 the ability to produce a good using fewer inputs than another producer TERM 23 Opportunity Cost DEFINITION 23 whatever must be given up to obtain something else TERM 24 Comparative Advantage DEFINITION 24 the ability to produce a good at a lower opportunity cost than another producer TERM 25 Imports DEFINITION 25 goods produced abroad and sold domestically TERM 26 Exports DEFINITION 26 Goods produced domestically and sold abroad TERM 27 market DEFINITION 27 a group of buyers and sellers of a particular good or service TERM 28 Competitive market DEFINITION 28 a market in which there are many buyers and many sellers so that each has a negligible impact on the market price TERM 29 Quantity Demanded DEFINITION 29 the amount of a good that buyers are willing and able to purchase TERM 30 law of demand DEFINITION 30 the claim that, other things equal, the quantity demanded of a good falls when the price of a good rises TERM 31 demand schedule DEFINITION 31 a table that shows the relationship between the price of a good and the quantity demanded TERM 32 demand curve DEFINITION 32 a graph of the relationship between the price of a good and the quantity demanded TERM 33 normal good DEFINITION 33 a good for which, other things equal, an increase in income leads to an increase in demand TERM 34 inferior good DEFINITION 34 a good for which, other things equal, an increase in income leads to a decrease in demand TERM 35 substitutes DEFINITION 35 two goods for which an increase in the price of one leads to an increase in the demand for the other TERM 46 Law of Supply and Demanded DEFINITION 46 the claim that the price of any good adjusts to bring the quantity supplied and the quantity demanded for that good into balance. TERM 47 Gross Domestic Product DEFINITION 47 the market value of all final goods and services produced within a country in a given period of time TERM 48 Consumption DEFINITION 48 spending by households on goods and services, with the exception of purchases of new housing TERM 49 Investment DEFINITION 49 spending on capital equipment, inventories, and structures, including household purchases of new housing TERM 50 government purchases DEFINITION 50 spending on goods and services by local, state, and federal governments TERM 51 Net Exports DEFINITION 51 spending on domestically produced goods by foreigners (exports) minus spending on foreign goods by domestic residents (imports) TERM 52 Nominal GDP DEFINITION 52 the production of goods and services valued at current prices TERM 53 Real GDP DEFINITION 53 the production of goods and services valued at constant prices TERM 54 GDP Deflator DEFINITION 54 a measure of the price level calculated as the ratio of nominal GDP to real GDP times 100