Eco 304k - Study guides, Class notes & Summaries

absolute advantage - the ability of a party (an individual, or firm, or country) to produce a greater quantity of a good, product, or service than competitors, using the same amount of resources. average fixed cost (AFC) - Total fixed cost divided by the number of units of output; aper-unit measure of fixed costs average product - The average amount produced by each unit of a variable factor of production average total cost (ATC) - Total cost divided by the number of units of output averag...

Ten Principles of Economics - 1. People face trade-offs 2. The cost of something is what you give up to get it 3. Rational people think at the margin 4. People respond to incentives 5. Trade can make everyone better off 6. Markets are usually a good way to organize economic activity 7. Governments can sometimes improve market outcomes 8. A country's standard of living depends on its ability to produce goods and services 9. Prices rise when the government prints too much money 10. Socie...