Econ 222 Vocab Chapter 1

  1. Efficiency
    The property of society getting the most it can from its scarce resources
  2. Economics
    The study of how society manages its scarce resources
  3. Scarcity
    The limited nature of societies resources
  4. Equity
    The property of distributing economic prosperity fairly among the members of society
  5. Opportunity Cost
    Whatever must be given up to obtain some item
  6. Rational People
    People who systematically and purposefully do the best they can to achieve their objectives
  7. Marginal Changes
    Small, incremental adjustments to a plan of action
  8. Incentive
    Something that induces a person to act
  9. Market Economy
    An economy that allocates resources through the decentralized decisions of many firms and households as they interact in markets for goods and services
  10. Property Rights
    The ability of an individual to own and exercise control over scarce resources
  11. Market Failure
    A situation in which a market left on its own fails to allocate resources efficiently
  12. Externality
    The impact of one person's actions on the well-being of a bystander
  13. Market Power
    The ability of a single economic actor (or small group of actors) to have a substantial influence on market prices
  14. Productivity
    The quantity of goods and services produced from each hour of a worker's time
  15. Inflation
    An increase in the overall level of prices in the economy
  16. Business Cycle
    Fluctuations in economic activity, such as employment and production
Card Set
Econ 222 Vocab Chapter 1
Vocabulary for Econ 222 - Introduction to Macroeconomics Chapter 1