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Economics Vocab

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Term
Definition
Opportunity Cost   What you are giving up by choosing something else.  
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Scarcity   There is only so much of everything.  
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Incentive   Your motivation.  
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The Mantra of Economics   People make choices with scarce resources, and they interact with others when they make these choices.  
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Microeconomics   Examines the behavior and decisions of individual firms and households and the way they interact in specific industries and markets.  
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Macroeconomics   Focuses on the whole national economy or even the whole world economy. This examines the workings and problems of the whole economy, looking at features such as GDP growth and unemployment.  
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Monatary   Of or relating to money or currency.  
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Non-Monatary   Not relating to money or currency.  
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Gains From Trade   Improvements in income, production, or satisfaction owning the exchange of goods or services.  
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Specialization   Occurs when people or countries can concentrate on the items that can be produced most efficiently.  
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Division of Labor   Allows individuals to perform the task they do best.  
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Comparative Advantage   When one person or group can produce one good at a lower opportunity cost then another person or group.  
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