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Cards In This Set
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Economics
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The study of how people allocate their limited resources in an attempt to satisfy their unlimited wants. As such, economics is the study of how people make choices
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Microeconomicss
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The study of decision making undertaken by individuals and by firms
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Macroeconomics
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The study of the behavior of the economy as a whole, including such economy wide phenomena as changes in unemployment, the general price level, and national income
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Positive economics
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Analysis that is strictly limited to making either purely descriptive statements or scientific predictions
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Normative economics
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Analysis involving value judgments about economic policies, relates to whether things are good or bad. A statement of what ought to be
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An economic goods is....
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Scarce, wanted, and useful
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Production
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Any activity that results in the conversion of resources into products that can be used in consumption
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Production resources
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Land, labor, capital(physical or human), and entreprenuership
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Cost is always a
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Forgone alternative
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Price floor
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Minimum legal price; above equilibrium
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Adam Smith
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Father of modern economics; Wealth of a Nation
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Price ceiling
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Maximum legal price; below equilibrium
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Complimentary goods
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If the need of one good increases, the good of another increases
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Substitute goods
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Goods that provide the consumer with identical or similar satisfaction
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When income increases
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Consumption increases
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