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| | **microeconomics (the study of individual “micro” market decisions, companies, consumers) | | **microeconomics (the study of individual “micro” market decisions, companies, consumers) |
| | *'''scarcity''' (when "wants" exceed free availability of the good; scarcity is what makes economics meaningful) | | *'''scarcity''' (when "wants" exceed free availability of the good; scarcity is what makes economics meaningful) |
| | + | *'''invisible hand''' |
| | *'''opportunity cost''' | | *'''opportunity cost''' |
| | *'''transaction cost''' | | *'''transaction cost''' |
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| | *'''inelastic demand''' | | *'''inelastic demand''' |
| | *'''price elasticity of demand''' (percent change in quantity demanded divided by percent change in price, dropping the negative sign) | | *'''price elasticity of demand''' (percent change in quantity demanded divided by percent change in price, dropping the negative sign) |
| | + | *'''price controls (ceilings and floors)''' |
| | *'''marginal cost''' (MC = change in total cost (TC) due to producing one more unit of output Q) | | *'''marginal cost''' (MC = change in total cost (TC) due to producing one more unit of output Q) |
| | *'''total fixed costs''' (TFC) do not change as more is produced, thus MC = change in TVC due to one more output Q) | | *'''total fixed costs''' (TFC) do not change as more is produced, thus MC = change in TVC due to one more output Q) |
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| | | | |
| | *'''price discrimination''' | | *'''price discrimination''' |
| | + | *'''minimum wage''' |
| | *'''cross-elasticity of demand''' (percent change in demand for good X divided by percent change in price for good Y) | | *'''cross-elasticity of demand''' (percent change in demand for good X divided by percent change in price for good Y) |
| | *'''income elasticity of demand''' (percent change in demand for good X divided by percent change in income) | | *'''income elasticity of demand''' (percent change in demand for good X divided by percent change in income) |
| − | *'''law of equiproportional marginal benefit''' | + | *'''supply elasticity''' |
| | + | *'''division of labor''' |
| | + | *'''tariffs and quotas''' |
| | *'''condition for reducing production''' (MC>MR) | | *'''condition for reducing production''' (MC>MR) |
| | *'''condition for shutting down''' (P<AVC in short run or P<ATC in long run) | | *'''condition for shutting down''' (P<AVC in short run or P<ATC in long run) |