economics quarterly review

Private Goods

A good that is bought for your own consumption.

Public Goods

A service that everyone can use.

Opportunity Cost

The value of what is given up when making a decision.

Trade-Off

The sacrifice of one option to pursue another.

Services

A tangible activity benefit or assistance provided to a customer.

Wants

A desire for goods and services that are not essential for survival.

Needs

Basic requirements for human survival and wellbeing.

Scarcity

Having seemingly unlimited human wants and limited resources.

Shortage

When the demand for a good or service exceeds its supply.

Market Economy

An economic system driven by supply and demand.

Command Economy

An economic system in which the government controls all resources.

Economic Growth

The increase in the production of goods and services.

Economic Freedom

The ability of individuals and businesses to make economic decisions without government interference.

Patent

A legal right granted to an inventor giving them rights to use, sell, and manufacture their invention.

Copyright

A legal right granted to the creator of an original work.

Competition

Rivalry among businesses.

Public Disclosure Laws

Laws requiring companies to make certain information available to the public.

Household

A group of people who live together and share resources.

Firm

A business organization that produces goods and services.

Demand

The consumer's willingness and ability to buy a specific good or service at a given price.

Law of Demand

As the price of a product decreases, the quantity demanded increases, and as the price increases, the quantity demanded decreases.

Demand Schedule

A table that shows the relationship between the price of a good and the quantity demanded.

Income Effect

A change in the quantity demanded of a good or service resulting from a change in consumers' purchasing power.

Substitution Effect

How consumers react to a change in the price of a product by substituting it with a different product that offers a better value.