Macro Chapter !
Terms
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- Scarcity
- The condition in which human wants are forever greater than the available supply of time, goods, and resources
- Resources
- The basic categories of inputs used to produce goods and services. Resources are also called "factors of prodction" Economists divide resources into three categories: land, labior and capital.
- Land
- A shorthand expression for any natural resource provided by nature
- Labor
- The mental and physical capacity of workers to produce goods and services
- Entrepreneurship
- The creative ability of individuals to seek profits by taking risks and combining resources to produce innovative products.
- Capital
- The physical plants, machinary, and equipment used to produce other goods. Gapital goods are humanmade goods that do not directly stisfy human wants.
- Economics
- The study of how society cooses to allocate its scarce resources to the production of goods and services in order to satisfy unlimited wants.
- Macroeconomics
- The branch of economics that studies decision making for the economy as a whole.
- Microeconomics
- The branch of economics that studies decision making by a single individual, household, firm, industry, or level of government
- Model
- A simplified description of reality used to understand and prdict the relationship between variables.
- Ceteris paribus
- A latin phrase that menas that while certian variables change, "all other things remain unchanged."
- Positve economics
- An analysis limited to statements that are verifiable
- Normative economice
- An analysis based on value judgments.
- Direct relationship
- A positive association between two variables. When one variable increases, the other variable increases, and when one variable decreases, the other variable decreases
- Inverse relationship
- A negative association between two variables. When one variable increases, the other variable decreases, and when one variable decrease, the other variable increases
- Slope
- The ratio of the change in the variable on the vertical axis ( the rise or fall) to a change in the variable on the horizontal axis (the run)
- Independent relationship
- A zero relationship between two variables. When one variable changes, the other variable remains unchanged