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21 terms

Mr. Ok Econ

STUDY
PLAY
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