| A | B |
|---|
| efficiency | society getting the most from its scarce resources |
| equity | when prosperity is distributed uniformly |
| cost | whatever you give up to get an item/service |
| Rational People | think at the margin |
| marginal changes | intermental adjustments to an existiting plan |
| Production Possibilites Frontier | shows combinations of two goods one could make (if it is a point on the PPF, it's effecient) |
| absolute advantage | ability to produce a good using fewer inputs than another person |
| comparative advantage | the ability to produce a good at a lower opportunity cost |
| quanitity demanded | amount of good the buyers are willing and able to purchase |
| market | group of sellers and buyers |
| Law of demand | quantity demanded falls when the price increases (ceteris paribus-all else is equal) |
| demand schedule | relationship b/t price and quantity |
| Demand curve | always negative slope |
| Supply Curve | always positive slope |
| Law of Supply | quantity supplied rises when the price rises |
| Change in quantity supplied or demanded | moves along the s/d curve |
