click below
click below
Normal Size Small Size show me how
SS-Chapter 18 (1-2)
Question | Answer |
---|---|
Economics | the study of how we make decisions in a world where resources are limited |
Needs | things that are required for survival |
Wants | things that we would like to have, but we do not require |
Scarcity | not having enough resources to produce all the things we would like to have |
Economic Models | simplified representations of the real world that are used to explain how the economy works, or to predict what would if something in the economy should change |
Trade-off | the alternative you face if you decide to do one thing rather than another |
Opportunity Cost | the cost of the next best use of your time or money when you choose to do one thing rather than another |
Fixed Costs | costs, or expenses, that are the same no matter how many units of goods are produced |
Variable Costs | expenses that change with the number of products produced |
Total Costs | the fixed costs added to the variable costs |
Marginal Cost | the extra, or additional, cost of producing one additional unit of output |
Marginal Revenue | the change in total revenue (extra revenue) that results from selling one more unit of output |
Marginal Benefit | the additional or extra benefit associated with an action |
Cost-Benefit Analysis | economic model that compares the marginal costs and marginal benefits of a decision |