Basic economic terms and concepts including economy types, supply and demand curves, price ceilings, and price floors.
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| 5800134822 | macroeconomics | the study of aggregate economic variables such as national income, employment, interest rates, exchange rates, and prices | 0 | |
| 5800135807 | market economy | type of economy where forces of supply and demand determine how production will be managed (ex. United States) | 1 | |
| 5800137634 | command economy | type of economy where the government makes all the decisions and owns all the factors of production (ex. Cuba) | 2 | |
| 5800138120 | traditional economy | economic decisions are made based on the way ancestors did things (ex. third world countries) | 3 | |
| 5800140120 | Four Factors of Production | land, labor, capital, entrepreneurship | 4 | |
| 5800141266 | opportunity cost | the most valuable sacrifice for choosing one thing over another. | 5 | |
| 5800141890 | production possibilities curve (PPC) | a graph displaying the maximum amount that can potentially be produced by one nation or producer at a given time, with current resources and technology. |  | 6 |
| 5800147223 | Formula for Opportunity Cost | Opportunity Cost of A=B/A or sacrifice/gain | 7 | |
| 5800149311 | The Law of Increasing Opportunity | as you increase the unit production of one factor, the unit production of another factor must decrease | 8 | |
| 5800151217 | absolute advantage | when an individual, group, or country has the ability to produce a product more efficiently than another. | 9 | |
| 5800151741 | comparative advantage | when an individual, group, or country has the ability to produce a product at a lower opportunity cost than another. | 10 | |
| 5800155391 | demand | when an entity is both willing and able to purchase an item. |  | 11 |
| 5800156618 | If price is high, then | quantity demanded is low | 12 | |
| 5800156619 | If price is low, then | quantity demanded is high | 13 | |
| 5800158116 | Demand curves have a | negative slope | 14 | |
| 5800159544 | Demand shift curves can be due to: | tastes, related goods, income, buyers, or expectations (TRIBE) | 15 | |
| 5800161075 | compliments | goods whose demand is dependent upon the change in price of a another good (ex. shoelace demand increases when tennis shoe prices decrease) | 16 | |
| 5800162672 | substitutes | goods whose demand increases as the price of another good increases (ex. sandals are substitutes for tennis shoes) | 17 | |
| 5800163910 | income effect | a change in income will lead to a change in consumption | 18 | |
| 5800164795 | substitution effect | a change in income will lead to a substitution of less expensive goods for expensive ones | 19 | |
| 5800165650 | supply | when producers are willing and able to produce goods and services at different prices in the marketplace |  | 20 |
| 5800167268 | A change in price will only change. . . | quantity supplied | 21 | |
| 5800169706 | Supply curves can shift due to: | resources, opportunities, taxes, technology, expectations, or number (ROTTEN) | 22 | |
| 5800173767 | equilibrium | the point where the supply and demand curves meet |  | 23 |
| 5800176627 | Teens start to prefer prefer breath mints over gum. |  | 24 | |
| 5800178385 | Teen income increases, increasing demand for gum. |  | 25 | |
| 5800179752 | Government increases taxes on gum suppliers. |  | 26 | |
| 5800181278 | New machine makes gum faster and cheaper. |  | 27 | |
| 5800185297 | Price is indeterminate in a double shift if. . . | you don't know if supply or demand would increase more. | 28 | |
| 5800189226 | price floor | when the government sets the lowest price a business is allowed to charge for a good or service | 29 | |
| 5800189868 | Price floors result in. . . | a surplus since producers are making more goods than people are willing to buy at the price set by the government. | 30 | |
| 5800189869 | price ceiling | when a legal price maximum is placed on a good | 31 | |
| 5800190653 | Price ceilings result in. . . | a shortage of goods since demand is higher than supply. | 32 |
