Jingtong's Economics
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28 terms
Terms | Definitions |
|---|---|
 wants | something that one doesn't need to survive |
| needs | Things one needs to survive |
| Market | A place were trading takes place where theres always a buyer and a seller |
| Economy | An economy is formed by different markets and supported by the country or a particular region |
| Micro-economy | The economic decisions one makes and the effects of it on the individual |
| Resources | Split into 3 categories: Natural, man made and human. |
| Natural resources | Raw material |
| Man made resources | Products made by humans |
| Human resource | Specialists e.g. Doctors |
| Scarce | The amount is finit, not a lot |
| Growth | The development of the economy |
| Effective demand | The level of demand that represents a real intention to purchase by people with the means to pay. |
| Latent demand | Something that is wanted but cannot be afforded |
| Cetris Paribus | With other conditions remaining the same. |
| Normal good | Any goods for which demand increases when the income increases and falls when the income decreases but price remains constant |
| Inferior good | An inferior good is the opposite of a normal good, which experiences an increase in demand along with increase in the income level. |
| Substitute good | One kind of good (or service) is said to be substitute good for another kind of insofar as the two kinds of good can be consumed or used inlace of one another in at least the same of their possible uses. |
| Complimentary good | A complimentary good, in contrast to a substitute good, is a good with a negative cross elasticity of demand. |
| resource allocation | used to assign the available resources in an economic way. Its part of resources management. |
| Excess Demand | When Demand is greater than the supply |
| Excess Supply | When the supply is greater than the demand (surplus) |
| Price Equalibrium | Where the supple and Demand equals out |
| Disequalibrium | A price that would not last long |
| Fixed cost | Costs that don't vary with the output |
| Variable costs | Very directly with output (e.ge wages and raw materials) TC = FC+VC |
| Average costs | Total costs decided by the output |
| Total revenue | The amount of money received from selling its output TR = Price*Quantity |
| Average Revenue | The average amount of money received from selling one unit of output ( AR = TR/output) |
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