Module 1 - D2L
equilibrium
When supply=demand
a computer
a good, not a service
inflation
an increase in overall prices
prices increase
demand decreases
when to choose
marginal benefits > marginal cost
price floor
minimum price set by the government
stabilize the economy
pay more money for low paying jobs
needs
things required for survival
correct for externalities
a company pays a fine for damaging the environment
provide public goods and services
bus, train, firemen, police, ambulance
positive externalities
encourages education
opportunity cost would steadily increase
if you spent all your time surfing the web for a week
price ceiling
max price set by the government
when supply increases
prices decrease
when demand increases
prices increase
supply
the amount of product available for sale
annual opportunity cost
the cost of what you would have spent plus income lost
reason for economics
wants are unlimited, resources are scarce
opportunity cost
when one alternative is chosen over another
resource scarcity
why people have to make choices