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Terms of trade
Terms in this set (14)
Basic substance in its natural, modified, or semi-processed state, used as an input to a production process for subsequent modification or transformation into a finished good.
A good or service brought in from another country for sale.
Materials or substances such as minerals, forests, water, and fertile land that occur in nature and can be used in the production process for economic gain.
The goods and services that a nation produces and then sells to other nations.
The obtained benefits from the consumption of goods and services.
economies of scale
Reduction in cost per unit resulting from increased production, realised through operational efficiencies. Economies of scale can be accomplished because as production increases, the cost of producing each additional unit falls.
Capital goods that are designed for a very specialised function within the production of goods and services.
long-run average cost
The cost per unit of output at which a firm is able to produce a given quantity of output in the long run, when no inputs are fixed (all factor inputs are variable).
Are resources used in the process of production.
income that is adjusted for prices changes, and implies the actual purchasing power of a consumer.
An economy that does not interact with other economies in the world.
The ability of a company to change prices and output, like a monopoly.
Sometimes called organisational slack, not reducing costs to their lowest level - the gap between the actual and lowest possible cost.
An economy that interacts freely with other economies around the world, especially engaging in the exchange of goods and services with other countries.
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