Test 1 Study Guide Terms
Scarcity: the goods available are too few to satisfy individuals' desires.
Opportunity Cost: the benefit that you might have gained from choosing the next-best
Normative Economics: the study of what the goals of the e
LO1. Discuss the principle of diminishing marginal utility and the principle of rational
Diminishing Marginal Utility: as you consume more of a good, after some point, the marginal
utility received from each additional unit of a good de
Unit II Terms
Utility: The pleasure or satisfaction that one expects to get from consuming a good or service.
Total Utility: The total satisfaction one gets from consuming a product.
Marginal Utility: The satisfaction one gets from consuming one additiona
Ch. 14 Monopolistic Competition
LO1. Summarize the defining characteristics of monopolistic competition.
LO2. Determine a monopolistically competitive firms long-run price, output, and average
total cost graphically and numerically.
LO3. Explain excess ca