Mr. Ok Econ
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Created by:
jurassicdave on March 18, 2012
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21 terms
Terms | Definitions |
|---|---|
 Needs | Needs are the basic and fundamental things that humans need to survive. |
| Capital | Large sum of money which people use to start a business or invest to make money. |
| Labour | Hard work, usually physical. |
| Macroeconomics | The branch of economics concerned with aggregates, such as national income, consumption and investment. |
| Microeconomics | The branch of economics concerned with particular commodities, firms or individual. |
| Elasticity | The measurement of how changing one economic variable affects others. |
| Total revenue | Total receipts of a firm from the sale of any given quantity of a product. |
| Equilibrium Price | Price where supply and demand are equal. |
| Elastic demand | Change in price result in a greater change in demand. |
| Production Possibility Curve (PPC) | Line shows the different combinations of two goods an aconomy can produce if all resources are used up. |
| Diseconomies of scale | Average costs rise when a firm becomes too big. |
| Economies of scale | Average costs fall due to expansion of a firm. |
| Internal economies of scale | Cost benefit that an individual firm can have when it expands. |
| Scale | Size of business. |
| Minimum efficient scale (MES) | Size of plant when the average cost is minimized. |
| External econmoies of scale | Cost benefit that all firms in industry can have when it expands. |
| Average cost | Cost per unit of output (Total cost/Quantity produced) |
| Costs | Money used when producing goods or services |
| Fixed costs | Costs that do not vary with level of output. |
| Variable costs | costs that rise when output are increased. |
| Total cost | Fixed cost + Variable cost |
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