19322959
Description
Flashcards by Nandana Kulasekhar, updated more than 1 year ago
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Created by Nandana Kulasekhar
over 4 years ago
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| Question | Answer |
| Scarcity | The limited nature of society's resources |
| Economics | The study of how society manages its scarce resources |
| Efficiency | The property of society getting the most it can from its scarce resources |
| Equality | The property of distributing economic prosperity uniformly among the members of society |
| Opportunity Cost | Whatever must be given up to obtain some item |
| Rational People | People who systematically and purposefully do the best they can to achieve their objective |
| Marginal Change | A small incremental adjustment to a plan of action |
| Incentive | Something that induces a person to act |
| Market Economy | An economy that allocates resources through the decentralized decisions of many firms and households as they interact in markets for goods and services |
| Property Rights | The ability of an individual to own and exercise control over scarce resources |
| Market Failure | A situation in which a market left on its own fails to allocate resources efficiently |
| Externality | The impact of one person's actions on the well-being of a bystander |
| Market Power | The ability for a single economic actor to have a substantial influence on market prices |
| Productivity | The quantity of goods and services produced from each unit of labor input |
| Inflation | An increase in the overall level of prices in the economy |
| 1st Principle of Microeconomics | People Face Trade-offs |
| 2nd Principle of Microeconomics | The Cost Of Something Is What You Give Up To Get It |
| 3rd Principle of Microeconomics | Rational People Think At The Margin |
| 4th Principle of Microeconomics | People Respond To Incentives |
| 5th Principle of Microeconomics | Trade Can Make Everyone Better Off |
| 6th Principle of Microeconomics | Markets Are Usually A Good Way To Organize Economic Activity |
| 7th Principle of Microeconomics | Governments Can Sometimes Improve Market Outcomes |
| 8th Principle of Microeconomics | A Country's Standard Of Living Depends On Its Ability To Produce Goods and Services |
| 9th Principle of Microeconomics | Prices Rise When The Government Prints Too Much Money |
| 10th Principle of Microeconomics | Society Faces A Short-Run Trade-off Between Inflation And Unemployment |
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