ch 2 macroeconomics

  1. 3 Fundamental Economics Question
    • What - to produce
    • How - to produce
    • For whom - to produce
  2. Opportunity Cost
    The best alternative sacrificed for a chosen alternative
  3. Marginal analysis
    An examination of the effects of additions to or subtractions from a current situation.
  4. Production Possibilities Curve
    A curve that shows the maximum combinations of two outputs an economy can produce in a given period of time with its available resources and technology.
  5. Technology
    The body of knowledge applied to how goods are produced.
  6. Law of Increasing Opportunity Cost
    The principle that the opportunity cost increases as production of one output expands
  7. Economic growth
    The ability of an economy to produce greater levels of output, represented by an outward shift of its production possibility curve.
  8. Investments
    The accumulation of capital, such as factories, machines and inventories that is used to produce goods and services.
Card Set
ch 2 macroeconomics