Microeconomics Final Review • Opportunity Cost – The highest-value alternative that we give up to get something. • “There is no such thing as free lunch” – Saying that emphasizes that you cannot get something for nothing; you need to give something else up to get anything. • Positive Statement – a statement of what something is, (as opposed to what it ought to be) as in an increase in unemployment caused a rise in inflation. • Scarcity – Our inability to satisfy all our wants. • • Read the Book on Efficient Production. • Equilibrium Price – The price at which the quantity demanded equals the quantity supplied. • Inferior Good – A good for which demand decreases as income increases. • Normal Good – A good for which demand increases as income increases. • Elasticity – the measure of how much buyers and sellers respond to changes in market conditions. • Read all that Elasticity stuff.
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This note was uploaded on 04/07/2008 for the course ECON 20010 taught by Professor Kim during the Fall '07 term at Notre Dame.