Macroeconomics chapter 3 vocab PDF

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ECO2013 at FIU...

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Chapter 3 economics Study online at quizlet.com/_4jxqjz 1.

circular flow of economic activity

the economic relationships that exist between different economic groups in an economy

2.

contract

an agreement between two or more people to do something (teacher contract says what time they have to be in work)

3.

entrepreneur

A person who has a special talent got searching out and taking advantage of new business opportunities (Misha from Misha's cupcakes)

4.

ethics

the principles of conduct that govern a group or society (right and wrong. What's ethical may it be legal, what's legal may not be ethical)

5.

excludable public good

A public good that individuals CAN be excluded from consuming (C.B. smith park, it has gates)

6.

free rider

a person who receives the benefit of a good but avoids paying for it (you don't pay property taxes but you drive on Miramar Pkwy)

7.

household

an economic unit of one person or more that sells resources and buys goods and services (mom, dad, me: dad sells his labor)

8.

loss

the amount of money by which total cost exceeds total revenue (cost>revenue)

9.

negative externality

an adverse side effect of an act that is felt by others (developing lung cancer from second hand smoke)

10.

nonexcludable public good

a public good that individuals cannot be excluded from consuming (the roads)

11.

positive externality

A beneficial side effect of an action that is felt by others (you don't get the flu shot but everyone else does so you are less likely to get the flu)

12.

private good

a good for which one person's consumption takes away from another person's consumption (if you use a taco, I cannot use the same taco)

13.

private property

any good that is owned by an individual or a business (car, house)

14.

profit

The amount of money left over after all the costs of production have been paid (revenue>cost)

15.

public good

a good or service whose consumption by one person does not exclude consumption by others (the ocean, beach)

16.

public property

any good that is owned by the government (school building)...