cramberry

Ch.1

created by darylcorrea, 7 cards, 1 user

1. Invisible hand

   Adam Smith concept of the market- guides firms that seek only to satisfy their own self-interest to produce precisely those goods that consumers want

2. Firms

   economic unit that produces goods in expectations of selling them to households, other firms, or government

3. Macroeconomics

   focuses attention on the behavior of the economy as a whole

4. Microeconomics

   looks at behavior of individual households and firms, and analyzes individuals as consumers and producers

5. Economics

   study of how people work together to transform resources into goods and services to satisfy their wants, and how they distribute these goods among themselves

6. Ceteris paribus

   "everything else being equal"; allows economists to develop one-to-one cause and effect relationships removed from other potentially influential factors

7. Consumer sovereignty

   The ability of consumers to exercise complete control over what goods and services the economy produces by choosing what good and services to buy

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