Questions On The Economic Terms Essay

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1.1 Explain key economic terms.

Scarcity Is mainly making a choice. We would have to make a trade -off by giving up on one thing and getting another such as you choose to buy a new car over a new phone.

Tanstaafl is the sum up word for both the definition of scarcity/opportunity cost. If the goods and resources are scares then there is nothing free simply requires us giving up on one thing to get our hands on the other.

Micro economics is concerned with decision making on a small scale such as consumers, workers, businesses or firms and how they communicate with each and other and look at different markets at the same time.

Macroeconomics which is mainly measuring how the economy as a whole is doing example of that would mainly be the GDP (which would try to value the amount of stuff produced)

Inflation in which the value of the stuff increases and for that people would look for other alternatives such as when the prices of potatoes would go up people would buy more rise as a source of carbohydrates.

Models are mainly a series of situations described in an economical way moving from one model to another different problem would have a different model applied to it (model=theory).

Voluntary exchange is when you change your goods for someone else goods.

Wants – Desires for goods/services.

Needs – Things which an economy would need to survive.

Choice – Uses scars resources to look for similar alternatives.

Scars resources – Choice would have to be made effectively as
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