InvisibleHandAdam Smith’s ideathat free marketprices will naturallyadjust to reachequilibrium withoutanyone having tocontrol prices.Shift inDemandFactors such asconsumer tastes andpreferences, prices ofrelated goods,population in themarket, andexpectations for thefuture can cause a…ComparativeAdvantageWhen one partyhas a loweropportunity costto produce agood than itstrading partner.Shift inSupplyFactors such as inputprices, number ofsellers in the market,technologyimprovements, andexpectations for thefuture can cause a…IncreasingA concave PPCdictates theopportunity costof increasingthe productionof a good is…MarketPriceThe equilibriumprice foundwhere quantitydemandedequals quantitysuppliedEquilibriumThe price andquantitywhere supplymeetsdemand.SurplusA signal that themarket price is toohigh; at this pricethe quantitysupplied is greaterthan the quantitydemanded.EntrepreneurshipThe unique andnew combinationof economicresources toproduce newgoods andservicesEfficientProductionAnycombination ofproduction ofgoods that liesalong the PPCUnattainableProductionAny combinationof production ofgoods that liesabove (orbeyond) thePPC.ConstantLinear PPCdictates theopportunity costof increasingthe productionof a good is…InelasticWhen demandfor a good is notsensitive tochanges in pricewe say thedemand is…InterestPaymentfor theuse ofcapitalLandNaturalresourcesused inproductionAbsoluteAdvantageWhen oneparty canproduce moreof a good thananother party.Trade-OffsYou must makechoices abouthow to useresourcesbecause theyare scarceUtilityThe satisfaction,or happiness,consumers getfrom consuminga good orserviceLaborHumaneffortused inproductionWagesPaymentfor theuse oflaborSupplyThe various quantitiesof a good or servicethat producers arewilling to sell at allpossible market prices.The curve representingthis is always upwardsloping.ShortageA signal that themarket price is toolow; at this pricethe quantitydemanded isgreater than thequantity supplied.SpecializationWhen a producerfocuses onproducing all ofone good in whichit has thecomparativeadvantageDemandThe desire,willingness, andability to buy a goodor service. Thecurve representingthis is alwaysdownward slopingScarcityLimitedresources tosatisfyunlimitedwantsElasticWhen demandfor a good issensitive tochanges in pricewe say thedemand is…TermsofTradeThe amount of goodX that is traded forone unit of good Y -this is acceptable toboth parties when itis between bothopportunity costs.Law ofDiminishingMarginalUtilityThe more of agood that isconsumed the lesssatisfaction isgained from eachadditional unit.RentPaymentfor theuse oflandCapitalMachineryand toolsused inproduction ProfitPayment forentrepreneurshipAttainableandInefficientProductionAnycombination ofproduction ofgoods that liesbelow (orinside) the PPCQuantitySuppliedChanges in aproduct'smarket pricewill lead sellersto increase ...ClosedEconomyAn economythat doesnot engagein tradeFactors ofProductionInputsneeded toproducegoods andservicesQuantityDemandedChanges in aproduct'smarket pricewill leadcustomers todecrease ...SubstituteGoodA product that canbe used in place ofanother good; forexample a sweaterand a jacket.ProductionPossibilitiesCurveA curve showingthe differentcombinations thatcan be producedwith the givenresourcesComplementGoodA product that isused with anothergood; forexample amousepad and acomputer mouse.OpportunityCostThe value ofthe “next bestalternative” usefor resources;what is given uInvisibleHandAdam Smith’s ideathat free marketprices will naturallyadjust to reachequilibrium withoutanyone having tocontrol prices.Shift inDemandFactors such asconsumer tastes andpreferences, prices ofrelated goods,population in themarket, andexpectations for thefuture can cause a…ComparativeAdvantageWhen one partyhas a loweropportunity costto produce agood than itstrading partner.Shift inSupplyFactors such as inputprices, number ofsellers in the market,technologyimprovements, andexpectations for thefuture can cause a…IncreasingA concave PPCdictates theopportunity costof increasingthe productionof a good is…MarketPriceThe equilibriumprice foundwhere quantitydemandedequals quantitysuppliedEquilibriumThe price andquantitywhere supplymeetsdemand.SurplusA signal that themarket price is toohigh; at this pricethe quantitysupplied is greaterthan the quantitydemanded.EntrepreneurshipThe unique andnew combinationof economicresources toproduce newgoods andservicesEfficientProductionAnycombination ofproduction ofgoods that liesalong the PPCUnattainableProductionAny combinationof production ofgoods that liesabove (orbeyond) thePPC.ConstantLinear PPCdictates theopportunity costof increasingthe productionof a good is…InelasticWhen demandfor a good is notsensitive tochanges in pricewe say thedemand is…InterestPaymentfor theuse ofcapitalLandNaturalresourcesused inproductionAbsoluteAdvantageWhen oneparty canproduce moreof a good thananother party.Trade-OffsYou must makechoices abouthow to useresourcesbecause theyare scarceUtilityThe satisfaction,or happiness,consumers getfrom consuminga good orserviceLaborHumaneffortused inproductionWagesPaymentfor theuse oflaborSupplyThe various quantitiesof a good or servicethat producers arewilling to sell at allpossible market prices.The curve representingthis is always upwardsloping.ShortageA signal that themarket price is toolow; at this pricethe quantitydemanded isgreater than thequantity supplied.SpecializationWhen a producerfocuses onproducing all ofone good in whichit has thecomparativeadvantageDemandThe desire,willingness, andability to buy a goodor service. Thecurve representingthis is alwaysdownward slopingScarcityLimitedresources tosatisfyunlimitedwantsElasticWhen demandfor a good issensitive tochanges in pricewe say thedemand is…TermsofTradeThe amount of goodX that is traded forone unit of good Y -this is acceptable toboth parties when itis between bothopportunity costs.Law ofDiminishingMarginalUtilityThe more of agood that isconsumed the lesssatisfaction isgained from eachadditional unit.RentPaymentfor theuse oflandCapitalMachineryand toolsused inproduction ProfitPayment forentrepreneurshipAttainableandInefficientProductionAnycombination ofproduction ofgoods that liesbelow (orinside) the PPCQuantitySuppliedChanges in aproduct'smarket pricewill lead sellersto increase ...ClosedEconomyAn economythat doesnot engagein tradeFactors ofProductionInputsneeded toproducegoods andservicesQuantityDemandedChanges in aproduct'smarket pricewill leadcustomers todecrease ...SubstituteGoodA product that canbe used in place ofanother good; forexample a sweaterand a jacket.ProductionPossibilitiesCurveA curve showingthe differentcombinations thatcan be producedwith the givenresourcesComplementGoodA product that isused with anothergood; forexample amousepad and acomputer mouse.OpportunityCostThe value ofthe “next bestalternative” usefor resources;what is given u

AP Macro: Unit 1 Vocab - Call List

(Print) Use this randomly generated list as your call list when playing the game. There is no need to say the BINGO column name. Place some kind of mark (like an X, a checkmark, a dot, tally mark, etc) on each cell as you announce it, to keep track. You can also cut out each item, place them in a bag and pull words from the bag.


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  1. Adam Smith’s idea that free market prices will naturally adjust to reach equilibrium without anyone having to control prices.
    Invisible Hand
  2. Factors such as consumer tastes and preferences, prices of related goods, population in the market, and expectations for the future can cause a…
    Shift in Demand
  3. When one party has a lower opportunity cost to produce a good than its trading partner.
    Comparative Advantage
  4. Factors such as input prices, number of sellers in the market, technology improvements, and expectations for the future can cause a…
    Shift in Supply
  5. A concave PPC dictates the opportunity cost of increasing the production of a good is…
    Increasing
  6. The equilibrium price found where quantity demanded equals quantity supplied
    Market Price
  7. The price and quantity where supply meets demand.
    Equilibrium
  8. A signal that the market price is too high; at this price the quantity supplied is greater than the quantity demanded.
    Surplus
  9. The unique and new combination of economic resources to produce new goods and services
    Entrepreneurship
  10. Any combination of production of goods that lies along the PPC
    Efficient Production
  11. Any combination of production of goods that lies above (or beyond) the PPC.
    Unattainable Production
  12. Linear PPC dictates the opportunity cost of increasing the production of a good is…
    Constant
  13. When demand for a good is not sensitive to changes in price we say the demand is…
    Inelastic
  14. Payment for the use of capital
    Interest
  15. Natural resources used in production
    Land
  16. When one party can produce more of a good than another party.
    Absolute Advantage
  17. You must make choices about how to use resources because they are scarce
    Trade-Offs
  18. The satisfaction, or happiness, consumers get from consuming a good or service
    Utility
  19. Human effort used in production
    Labor
  20. Payment for the use of labor
    Wages
  21. The various quantities of a good or service that producers are willing to sell at all possible market prices. The curve representing this is always upward sloping.
    Supply
  22. A signal that the market price is too low; at this price the quantity demanded is greater than the quantity supplied.
    Shortage
  23. When a producer focuses on producing all of one good in which it has the comparative advantage
    Specialization
  24. The desire, willingness, and ability to buy a good or service. The curve representing this is always downward sloping
    Demand
  25. Limited resources to satisfy unlimited wants
    Scarcity
  26. When demand for a good is sensitive to changes in price we say the demand is…
    Elastic
  27. The amount of good X that is traded for one unit of good Y - this is acceptable to both parties when it is between both opportunity costs.
    Terms of Trade
  28. The more of a good that is consumed the less satisfaction is gained from each additional unit.
    Law of Diminishing Marginal Utility
  29. Payment for the use of land
    Rent
  30. Machinery and tools used in production
    Capital
  31. Payment for entrepreneurship
    Profit
  32. Any combination of production of goods that lies below (or inside) the PPC
    Attainable and Inefficient Production
  33. Changes in a product's market price will lead sellers to increase ...
    Quantity Supplied
  34. An economy that does not engage in trade
    Closed Economy
  35. Inputs needed to produce goods and services
    Factors of Production
  36. Changes in a product's market price will lead customers to decrease ...
    Quantity Demanded
  37. A product that can be used in place of another good; for example a sweater and a jacket.
    Substitute Good
  38. A curve showing the different combinations that can be produced with the given resources
    Production Possibilities Curve
  39. A product that is used with another good; for example a mousepad and a computer mouse.
    Complement Good
  40. The value of the “next best alternative” use for resources; what is given u
    Opportunity Cost