AP Microeconomics: Unit 1 Flashcards

7329294875	Economics	how an individual in society experiences limitless wants, and chooses to allocate its limited resources to satisfy wants	0
7329310189	Efficiency	receiving the maximum benefits from limited resources	1
7329315422	Equality	benefits are distributed uniformly among society's members	2
7329323216	Opportunity Cost	what one sacrifices in order to obtain what one wants	3
7329327704	Rational People	People who do their best to achieve their objects with the available opportunities	4
7329343898	Marginal Change	The smaller decision/trade-off	5
7329356343	Incentive	something that induces a person to act	6
7329367323	Market Economy	Decisions of individual producers and consumers largely determine what, how, and for whom to produce, with little government involvement in decisions	7
7329374458	Property Rights	Establish ownership and grant individuals the right to trade goods and services with each other	8
7329394126	Market Failure	When a market is left on its own and fails to allocate resources efficiently	9
7329469893	Productivity	Quantity of goods and services produced from each unit of labor	10
7329475657	Inflation	An increase in the overall level of prices in the economy	11
7329483494	Business Cycle	Fluctuations in economic activity between economic downturns, recessions, and economics upturns known as expansions	12
7329490900	Traditional Economic System	Economic tasks are passed on from generation to generation	13
7329497253	Command Economic System	Government answers each question	14
7329500340	Free Economic System	The producers and consumers answer economic questions	15
7329504798	Mixed Economic System	Producers, consumers, and government answers economic questions	16
7329558377	Service	Something tangible which satisfies peoples needs	17
7329577161	Scarce	Limited amount of a desired resource	18
7329587719	Four main resources	Land, Labor, Capital, and Entrepreneurship	19
7329590754	Land	Anything that comes from the earth	20
7329593912	Labor	Payment for salary and wages	21
7329602857	Capital	Goods that produce other goods for future use	22
7329607623	Entrepreneurship	Business risk and payment comes in the form of profit and loss	23
7329618857	Economics	Study of scarcity and individual choices	24
7329646519	Individual Choice	Decisions by individuals about what to do	25
7329651784	Economy	System for coordinating a society's productive and consumptive activities	26
7329675441	Command Economy	Industry is publicly owned and a central authority makes production an consumption decisions	27
7329716890	Marginal Analysis	Study of the costs and benefits of doing a little bit more of an activity vs. less	28
7329722222	Microeconomics	Study of how individuals make decisions and how those decisions interact	29
7329728565	Macroeconomics	Concerned with overall ups and downs in the economy	30
7329735630	Economic Aggregates	Economic measures that summarize data across many different markets	31
7329741069	Positive Economics	Objective (non-opinionated) statements that while they may not be true, they CAN be TESTED	32
7329743426	Normative Economics	Subjective statement that CAN'T BE TESTED	33
7329771657	Depression	Very deep and prolonged downturn	34
7329774107	Expansion	periods of economic upturns when output and employment are rising	35
7329781039	Employment	number of people employed in economy	36
7329784394	Unemployment	number of people who are actively looking for work, but aren't employed	37
7329795383	Output	quantity of goods and services produced	38
7329799394	Aggregate Output	economy's total production of goods and services for a given time period	39
7329803951	Deflation	Falling overall price	40
7329812867	Price Stability	Aggregate price level is changing only slowly	41
7329818261	Economic Growth	Increase in the maximum amount of goods and services an economy can produce	42
7329824866	Model	Simplified representation used to better understand a real life situation	43
7329831190	Trade-off	When you give up something in order to have something else	44
7329855169	Production Possibility Curve (PPF)	illustrates the trade-offs facing an economy that produces only two goods.	45
7329871476	Technology	Technical means for the production of goods and services	46
7329879906	Trade	Prove good and services to others and receive goods and services in return	47
7329885184	Gains from trade	Dividing tasks and trading, people can get more of what they want through trade than they could if they tried being self-sufficient	48
7329919988	Comparative Advantage	In producing goods or services if the opportunity cost of producing that good or service is lower for that individual than others	49
7329926901	Absolute advantage	Producing more of a good or service if they can make more of it with a given amount of time and resources	50
7329935253	Households	person or group of people who share income	51
7329939628	Firm	organization that produces and services for sale	52
7329942863	Product Market	goods and services are brought or sold	53
7329946337	Factor Market	where resources, especially capital and labor, are bought and sold	54
7329962717	Consumer Spending	Households spending money on goods and services	55
7329965549	Stocks	Share ownership of a company held by a shareholder	56
7329969873	Bond	loans that pay interest	57