ECON 101 Chapter Notes - Chapter 1-4,10-12: Market Economy, Inferior Good, Opportunity Cost

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12 Oct 2016
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Economics : the study of how society manages its scarce resources. Efficiency : the property of society getting the most it can from its scarce resources. Equality : the property of disturbing economic prosperity uniformity among the members of society. Opportunity cost : whatever must be given up to obtain some item. Rational people : people who systematically and purposefully do the best they can to achieve their objectives. Marginal cost : a small incremental adjustment to a plan of action. Incentive : something that includes a person to act. Market economy : an economy that allocates resources through the decentralized decisions of many firms and households as they interact in markets for goods and services. Property rights : the ability of an individual to own and exercise control over scarce resources. Market failure: a situation in which a market left on its own fails to allocate resources efficiency.

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