Economic Principles and Decision Making Quiz

The value of the next best alternative forgone

To analyze the behavior of individual economic units such as consumers, producers, and markets

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

Medium of exchange, not directly involved in production

Extra satisfaction obtained from consuming one additional unit of a good

Shows the theoretical relationship between tax rates and tax revenue

An inverse relationship between the price of a good and the quantity demanded

The boundary representing the maximum output possibilities of two goods given a set of inputs

Assuming all other variables remain unchanged

Total value of goods and services produced within a country's borders in a specific period

Measure of how much quantity supplied responds to a change in price

Illustrates the inverse relationship between unemployment and inflation

Measure of responsiveness of quantity demanded to a change in price

Individual firms have no influence on market price

Measure of consumer welfare derived from the difference between what consumers are willing to pay and what they actually pay

Country's ability to produce a good or service at a lower opportunity cost than another country

Hypothesis that suggests individuals anticipate future tax increases or spending cuts, offsetting the impact of fiscal policy