ch 1
Terms
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- land
- natural resources; oil, land, mineral, water
- macroeconomics
- examines either the economy as a whole or its basic subdivisons or aggregates like gov. household,
- two goods
- the economy is only producng two goods.
- factor of production
- inputs.
- generalizations
- economic principles are expressed as the tendencies of typical or average consumers, workers, or buisness firms
- capital goods
- products that satisfy our wants indirectly by making possible more efficient production of consumer goods
- economizing problem
- the need to make choices because economic wants exceed economic means
- full employment
- the economy is employing all its avaliable resources
- marginal analysis
- comparisons of marginal benefits and marginal costs
- fixed resources
- the quantity and quality of the factors of production are fixed
- opportunity costs
- the sacrafice of the choice of obtaining more of one thing, society forgoes the opportunity of getting the next best thing
- capital
- manufactured aids used in producing consumer goods and services
- productions possibility curve
- displays the different combinations of goods and services that society can produce in a fully employed economy (with fixed supplies and constant technology)
- aggregate
- a collection of specific economic units treated as if they were one unit
- economics
- how individuals/institutions make optimal choices under conditions of scarcity
- microeconomics
- economics concerned with individual units such as a person, a houlshold, a firm or industy
- normative economics
- incorporates value judgements about what the economy should be like
- economic growth
- respresents growth of economic capacity, which means a larger total output
- economic perspective
- economic way of thinking
- positive economics
- foucuses on facts and cause and effect relationships
- law of increasing opportunity costs
- as the production of a particular good increases, the opprotunity cost of producing an additional unit rises
- utility
- the pleasure, happiness, or satisfaction obtained from consuming a good or service
- investment
- purchase of capital goods
- economic resources
- all natural, human, and manufactured resources that go into the production fo goods and services
- ecnomic principle
- statement about economci behavior or the economy that enables predictions of the probable effects of certain actions
- fixed technology
- the state of technology is constant
- labor
- physical and mental talents of individuals used in producing goods and services
- other-things-equal assumption
- the assumption that factos other than those being considered do not change