ECO 211 Study Guide - Demand Curve, Economic Equilibrium, Midpoint Method
8 Nov 2013
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ECO 211 Full Course Notes
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Scarcity- the limited nature of society"s resources. Economics- the study of how society manages its scarce resources. Efficiency- the property of society getting the most it can from its scarce resources. 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 change- a small incremental adjustment to a plan of action. Incentive- something that induces a person to act. Market economy- an economy that allocates resouces through the decentralized decision 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 efficiently. Externality- the impact of one persons actions on the well-being of a bystander.
