Unit 1 Econ

Scarcity

The fundamental economic problem of having limited resources to meet unlimited wants.

Opportunity Cost

The cost of forgoing the next best alternative when making a decision.

Goods

Tangible items that can be consumed, such as food and clothing.

Services

Intangible items provided to consumers, such as education and healthcare.

Factors of Production

Resources used to produce goods and services, including land, labor, capital, and entrepreneurship.

Economic Systems

Different ways in which economies organize production and distribution, including traditional, command, market, and mixed economies.

Production Possibilities Curve (PPC)

A model that illustrates trade-offs and opportunity costs in production.

Law of Demand

States that as prices decrease, the quantity demanded increases, and vice versa.

Equilibrium Price

The price at which the quantity demanded equals the quantity supplied.

Personal Financial Planning

The process of managing income and expenses to meet financial goals.

Budgeting

A plan for managing income and expenses, categorized into fixed, variable, and discretionary expenses.

Revolving Credit

A type of credit that allows borrowing up to a limit, such as credit cards.

Credit Score

A numerical representation of creditworthiness, typically ranging from 300 to 850.

Debt Snowball Method

A debt repayment strategy where one pays off the smallest debt first before moving to larger debts.

Perfect Competition

A market structure characterized by many buyers and sellers, homogeneous products, and no single market power.

Monopolistic Competition

A market structure with many firms selling differentiated products and some degree of pricing power.

Oligopoly

A market structure dominated by a few large firms with high barriers to entry.

Monopoly

A market structure where a single firm controls the entire market with a unique product.

Market Power

The ability of a firm or group of firms to influence price or output in a market.

Price Discrimination

A strategy to charge different prices to different consumers based on their willingness to pay.

Natural Monopoly

A type of monopoly that exists due to high fixed costs of entry, where one firm can supply the entire market more efficiently.