EC121 Terms - Unit 1 Word Scramble
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| Term | Definition |
| circular-flow diagram | a diagram that views the economy as consisting of households and firms interacting in a goods and services market and a labor market |
| economics | the study of how humans make choices under conditions of scarcity |
| macroeconomics | the branch of economics that focuses on broad issues such as growth, unemployment, inflation, and trade balance. |
| microeconomics | the branch of economics that focuses on actions of particular agents within the economy, like households, workers, and business firms |
| scarcity | when human wants for goods and services exceed the available supply |
| specialization | when workers or firms focus on particular tasks for which they are well-suited within the overall production process |
| division of labor | the way in which the work required to produce a good or service is divided into tasks performed by different workers |
| marginal analysis | examination of decisions on the margin, meaning a little more or a little less from the status quo |
| comparative advantage | when a country can produce a good at a lower cost in terms of other goods; or, when a country has a lower opportunity cost of production |
| absolute advantage | when one country can use fewer resources to produce a good compared to another country; when a country is more productive compared to another country |
| utility | satisfaction, usefulness, or value one obtains from consuming goods and services |
| invisible hand | idea that self-interested behavior by individuals can lead to positive social outcomes |
Created by:
JNHerzing
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