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Class: ECON 112 - Principles of Microeconomics; Subject: Economics; University: Southern Illinois University Edwardsville; Term: Fall 2010;
Typology: Quizzes
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A specific advantage in one choice over someone else because of a lower opportunity cost TERM 2
DEFINITION 2 A person has absolute advantage if that person is more productive than the other person TERM 3
DEFINITION 3 A graph that describes the maximum amount of one good that can be produced for every level of production of the other good. TERM 4
DEFINITION 4 In expanding the production of any good, first employ those resources with the lowest opportunity cost, and only afterward turn to resources with higher opportunity costs. TERM 5
DEFINITION 5 The study of how people make choices under conditions of scarcity and of the results of those choices for society.
Boundless wants cannot be satisfied with limited resources. Therefore, having more of one thing usually means having less of another. Because of scarcity we must make choices. TERM 7
DEFINITION 7 Someone with well-defined goals who tries to fulfill those goals as best her or she can. TERM 8
DEFINITION 8 An individual (or firm or society) should take action if, and only if, the extra benefits from taking the action are at least as great as the extra costs. TERM 9
DEFINITION 9 The benefit of taking any action minus its cost. The goal of economic decision makers is to maximize their economic surplus. TERM 10
DEFINITION 10 The study of individual choice under scarcity and its implications for the behavior of prices and quantities in individual markets.
Maximum you'd be willing to pay TERM 17
DEFINITION 17 A curve or schedule showing the quantity of a good that sellers wish to sell at each price TERM 18
DEFINITION 18 The smallest dollar amount for which a seller would be willing to sell an additional unit, generally equal to marginal cost. TERM 19
DEFINITION 19 The values of price and quantity for which quantity supplied and quantify demanded are equal. TERM 20
DEFINITION 20 Goods that go together
Goods that replace one another TERM 22
DEFINITION 22 One whose demand increases (decreases) when the incomes of buyers increase (decrease). TERM 23
DEFINITION 23 One whose demand decreases (increases) when the income of buyers increase (decrease). TERM 24
DEFINITION 24 A market equilibrium leaves no unexploited opportunities for individuals, but may not exploit all gains achievable through collective action. TERM 25
DEFINITION 25 The "unexploited" potential gains from trade for one particular individual.
The percentage by which quantity demanded of the first good changes in response to a 1% change in the price of the second good. TERM 32
DEFINITION 32 The percentage by which quantity demanded changes in response to a 1% change in income. TERM 33
DEFINITION 33 The percentage change in the quantity supplied that occurs in response to a 1% change in price. TERM 34
DEFINITION 34 A measure of inefficiency. It is equal to the decrease in total surplus that results from an inefficient level of production.