Flashcards
economics beginning
Cards in this deck (28)
- 1CapitalThe physical plant, machinery and equipment used to produce other goods. Capital goods are human-made goods that do not directly satisfy human wants.
- 2Economic growthThe ability of an economy to produce greater levels of output, represented by an outward shift of its production possibilities frontier.
- 3Economic systemA system of production and exchange of goods and services as well as allocation of resources in a society.
- 4IncentiveIs something that motivates an individual to perform an action.
- 5LandA shorthand expression for any resource provided by nature.
- 6MicroeconomicsThe branch of economics that studies decision-making by a single individual, household, firm or industry.
- 7Opportunity CostThe best alternative sacrificed for a chosen alternative.
- 8Relative scarcityThe condition in which human wants are forever greater than the available supply of time, goods, services and resources.
- 9TechnologyThe body of knowledge applied to how goods and services are produced.
- 10Ceteris paribusA Latin phrase that means that while certain variables change, ‘all other things remain unchanged’
- 11Economic modelNumerical table graph or mathematical equation used to describe what is expected to happen in reality. Economics is a social science, involving human beings and their behaviors, so the models can never be perfect. Rather, they are a close approximation of what is reasonable to expect to happen.
- 12EconomicsThe study of how society chooses to allocate its scarce resources to the production of goods and services in order to satisfy unlimited wants.
- 13InvestmentThe process of producing capital, such as factories, machines and inventories.
- 14MacroeconomicsThe branch of economics that studies decision-making for the economy as a whole.
- 15Mixed economyIs an economic system that is variously defined as containing a mixture of markets and economic planning. A mixture of free market with government intervention.
- 16Positive EconomicsAn analysis limited to statements that are verifiable.
- 17Resources/factors of productionThe basic categories of inputs used to produce goods and services. Resources are also called factors of production. Economists divide resources into three categories: land, labor and capital.
- 18Command economyAlso known as Planned. Refers to an economic system whereby decisions regarding production and investment are made by a central authority. (for example, Government)
- 19Economic problemRelates to scarce resources and the three main economic question: 1. What to produce, 2. How to produce and 3. For whom to produce.
- 20EntrepreneurshipThe creative ability of individuals to seek profits by combining resources to produce new or existing products.
- 21LabourThe mental and physical capacity of workers to produce goods and services.
- 22MarketA place where forces of demand and supply operate, and where buyers and sellers interact.
- 23Normative economicsAn analysis based on value judgement.
- 24Production possibilities frontier(PPF)Is an economic model. The curve shows all the possible maximum combinations of two products that can be produced in an economy, given its available resources and technology.
- 25Self-interestThis involves members of the community respecting the laws while they pursue their own individual goals.
- 26EnterpriseEntrepreneurship is a special type of labor-the creative ability of individuals to seek profits by combining resources to produce.
- 27The economic way of thinkingusing economic models to help understand and predict the impact of changes in economic variables.
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