ECON 010 Study Guide - Comprehensive Final Exam Guide - Price Level, Inflation, Gross Domestic Product

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20 Nov 2018
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Scarcity: unlimited wants>limited resources available to fulfill wants. Economics: study of choices people make to attain goals given scarce resources. Economic model: simplified version of reality used to analyze real world economic situations. Market: group of buyers and sellers of a good/service and institution or arrangement by which they come together. Marginal analysis: analysis that involves comparing marginal benefits/costs. Trade-off: b/c of scarcity, producing more of one good or service means producing less of another. Centrally planned economy: gov decides how economic resources will be allocated. Market economy: decisions of households and firms interacting in markets allocate economic resources. Mixed economy: most economic decisions result from interaction of buyers and sellers in markets but gov plays significant role in allocation of resources. Product efficiency: good/service produced at lowest possible cost (b/c of competition among firms) Voluntary exchange: both buyer and seller of product are made better off by transaction (otherwise, they would not have agreed upon it)

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