AP Micro Unit 1 Flashcards

8641327364	economics	the study of how society manages its scarce resources the study of how society manages its scarce resources	0
8641392629	market economy	Economic decisions are made by individuals or the open market. Economic decisions are made by individuals or the open market.	1
8641392630	command economy	a system in which the central government makes all economic decisions	2
8641392631	mixed economy	an economic system combining private and public enterprise. an economic system combining private and public enterprise.	3
8641394667	incentives	rewards or other stimuli that motivate us to act	4
8641394668	factors of production	land, labor, capital, and entrepreneurship	5
8641394669	scarcity	limited and desirable; the limited resources and unlimited wants and needs of society	6
8641397515	marginal analysis	analysis that involves comparing marginal benefits and marginal costs analysis that involves comparing marginal benefits and marginal costs	7
8641397516	ceteris paribus	a Latin phrase that means "all other things held constant"; "all things being equal"	8
8641400195	opportunity cost	the cost of the alternative; value of the trade-off; what is given up of one thing to produce more of another	9
8641400196	microeconomics	the study of how households and firms make decisions and how they interact in markets the study of how households and firms make decisions and how they interact in markets; (individual actors in the economy)	10
8641400197	macroeconomics	the study of economy-wide phenomena, including inflation, unemployment, and economic growth the study of economy-wide phenomena, including inflation, unemployment, and economic growth	11
8641402529	aggregates	total; summation of all the individual parts in the economy;	12
8641402530	positive economics	the study of what is, and how the economy works	13
8641404764	normative economics	an analysis based on value judgments	14
8641406532	production possibilities curve	an economic model used to illustrate limited resources and trade-offs an economic model used to illustrate limited resources and trade-offs; shows opportunity costs	15
8641406533	efficiency	using resources in such a way as to maximize the production of goods and services; "on the curve"	16
8641410239	underemployment	inefficiency in the use of resources; wasting resources	17
8641410240	comparative advantage	the ability to produce a good at a lower opportunity cost than another producer the ability to produce a good at a lower opportunity cost than another producer	18
8641413685	absolute advantage	the ability to produce more of a given product using a given amount of resources	19
8641413686	gains from trade	the improvement in outcomes that occurs when producers specialize and exchange goods and services	20
8641415495	economic growth	the ability of the economy to increase the production of goods and services- usually through specialization and trade	21
8641415496	linear relationship	a relationship that has a straight line graph- for PPC (resources are comparable; similar)	22
8641419251	nonlinear relationship	a curve that shows the relationship between two variables in a non-straight line	23
8641419252	slope	rise over run	24