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28 terms

Jingtong's Economics

STUDY
PLAY
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)