Overview of Economics

These flashcards cover key vocabulary and principles from the Economics lecture, including concepts related to decision-making, market structures, economic indicators, and the impact of artificial intelligence on economics.

Economics

The study of how people make decisions regarding scarce resources.

Microeconomics

Focuses on the behavior of individual economic agents, such as households and firms.

Macroeconomics

Studies the economy as a whole, examining aggregate indicators like GDP and unemployment.

Scarcity

The limited nature of society's resources, preventing the production of all desired goods and services.

Trade-offs

The concept that to gain something, one usually must give up something else.

Opportunity Cost

The value of the next best alternative that is given up when making a decision.

Marginal Change

A small incremental adjustment to a plan of action.

Incentives

Factors that motivate individuals to take action or make decisions.

Market Economy

An economic system where production and prices are determined by unrestricted competition between privately owned businesses.

Market Failure

A situation in which a market left on its own does not allocate resources efficiently.

Externality

The impact of one person’s actions on the well-being of a bystander.

Inflation

An increase in the overall level of prices in the economy over time.

Standard of Living

The degree of wealth and material comfort available to a person or community.

Productivity

The quantity of goods and services produced from each unit of labor input.

Business Cycle

Fluctuations in economic activity marked by periods of expansion and contraction.

AI in Economics

The use of artificial intelligence to enhance economic data analysis, forecasting, and understand economic behavior.

Behavioral Economics

A field of economics that combines psychological insights with economic theory to understand how people make economic decisions.

Job Displacement

The loss of jobs due to automation and AI integration into the economy.

Ethical Considerations of AI

The challenges regarding data privacy, algorithmic fairness, and accountability in the use of AI in economic systems.