Economic Vocab Word Scramble
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| Question | Answer |
| different quantities of goods that an economy can produce with a given amount of scarce resources | Production possibilities |
| the value of the sacrifice made or pursue a course of action | Opportunity cost |
| two goods are consumer substitutes if they provide essentially the same utility to the consumer | Substitute goods |
| a good for which high income decreases demand | Inferior goods |
| production of maximum output for a given level of technology and resources. All points on the PPF are productively efficient | Productive efficiency |
| a producer has a comparative advantage if he can produce a good at lower opportunity cost than all other producers | Comparative advantage |
| two goods are consumer substitutes if they provide essentially the same utility to the consumer | Substitute goods |
| to predict how a change in one variable affects a second, we hold all other variables constant. This also referred to as the "ceteris paribus" assumption | All else equal |
| holding all else equal, when the price of a good rises, consumers decrease their quantity demanded for that good | Law of demand |
| the imbalance between limited productive resources and unlimited human wants. Because economic resources are scarce, the goods and services a society produces are scarce | Scarcity |
| called factors of production, these are commonly grouped into the four categories of labor, physical capital, land or natural resources, and entrepreneurial ability | Resources |
| the study of how people, firms, and societies use their scarce productive resources to best satisfy their unlimited material wants. | Economics |
| the market value of the final goods and services produced within a nation in a given year | Gross Domestic Product |
| the process of summing the microeconomic activity of households and firms into a more macroeconomic measure of economic activity | Aggregation |
| in the Aggregate Demand and Aggregate Supply model, this is described as falling demand with a constant supply curve. GDP falls and unemployment rises | Recession |
| a sustained falling price level, usually due to weakened aggregate demand and a constant aggregate supply | Deflation |
| the amount of knowledge and skills that labor can apply to the work they do and the general level of health that the labor force enjoys | Human capital |
| the percentage change in the CPI (prices) from one period to the next | Inflation |
| a prolonged, deep contraction in the business cycle | Depression |
| the period where real GDP is falling | Contraction |
| a period where real GDP is growing | Expansion |
| there periodic rise and fall (in four phases) of economic activity | Business cycle |
| the sum of all spending from four sectors of the economy. GDP=C+I+G+Xn | Aggregate Spending (GDP) |
| occurs when an economy's production possibilities increase | Economic growth |
| production of the combination of goods and services that provides the most net benefit to society | Allocative efficiency |
| when firms focus their resources on production of goods for which they have comparative advantage, they are said to be specializing | Specialization |
| exists if a producer can produce more of a good than all other producers | Absolute Advantage |
| the external factors that shift demand to the left or right | determinants of demand |
| a table showing quantity demanded for a good at various prices | demand schedule |
| the bottom of the business cycle where a contraction has stopped | trough |
| the top of a business cycle where an expansion has ended | Peak |
| a good for which higher income increases demand | Normal goods |
| a graphical depiction of the demand | Demand curve |
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