Economic Incentives Flashcards

Flashcards on Economic Incentives

Net Benefit

The value of something net of the costs of availing of it.

Reservation Option

Your next best option after the most preferred.

Economic Cost

Direct costs plus opportunity costs.

Economic Rent

The difference between net benefit of the option chosen and its opportunity cost.

Learning by Doing

By doing more of one thing, the better we are at it.

Difference in Ability

Differences in ability mean some people and places are better at producing certain things.

Economies of Scale

Larger scale production can be more efficient.

Comparative Advantage

Those with greater relative productive ability between different goods have this.