|40584320||Scarcity||the limited nature of society's resources.|
|40584321||Economics||the study of how society manages its scarce resources.|
|40584322||Efficiency||the property of society getting the most it can from its scarce resources.|
|40584323||Equity||the property of distribution economic prosperity fairly among the members of society.|
|40584324||Opportunity Cost||whatever must be given up to obtain some item.|
|40584325||Rational People||people who systematically and purposefully do the best they can to achieve their objectives.|
|40584326||Marginal changes||small incremental adjustments to a plan of action.|
|40584327||Incentives||something that induces a person to act.|
|40584328||Market Economy||an economy that allocates resources through the decentralized decisions of many firms and households as they interact in markets for goods and services.|
|40584329||Property rights||the ability of an individual to own and exercise control over scarce resources.|
|40584330||Market failure||a situation in which a market left on its own fails to allocate resources efficiently.|
|40584331||Externality||the impact of one person's actions on the well being of a bystander.|
|40584332||Market power||the ability of a single economic actor (or small group of actors) to have a substantial influence on market price.|
|40584333||Productivity||the quantity of goods and services produced from each hour of a worker's time.|
|40584334||Inflation||an increase in the overall level of prices in the economy.|
|40584335||Business cycle||fluctuations in economic activity, such as employment and production.|
AP Microeconomics: Chapter 1
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