Term
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Definition
| pleasure or satisfaction of a good or service |
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Term
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Definition
| amount of satisfaction of the entire consumption of a product |
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Term
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Definition
| the change in total utility obtained by consuming one additional (marginal) unit of a good or service |
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Term
| Law of Diminishing Returns |
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Definition
| the marginal utility of a good declines as more of it is consumed in a given time period |
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Term
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Definition
| quantity of a good demanded in a given time period increases as its price falls |
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Term
| Price Elasticity of Demand |
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Definition
| the percentage change of quantity demanded divided by the percentage change in price |
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Term
| Change in Quantity Demanded |
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Definition
| change in the quantity demanded exemplified by a movement up and down the demand curve in response to a change in price |
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Term
| Change in Demand (Shift in Demand) |
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Definition
| change in the quantity demanded at any or every price |
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Term
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Definition
| percentage change in quantity demanded divided by percentage change in income |
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Term
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Definition
| a good or goods for which demand increases when income rises |
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Term
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Definition
| a good or goods for which demand decreases when income rises |
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Term
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Definition
| goods that substitute for each other, when the price of good x rises, the demand for y increases |
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Term
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Definition
| goods frequently consumed in combination; when the price of good x rises, the demand for good y falls |
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Term
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Definition
| the percentage change in the quantity demanded of good x divided by the percentage change in the price of y |
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Term
| Marginal Physical Product (MPP) |
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Definition
| the change in total output associated with one additional unit of input |
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Term
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Definition
| the market value of all resources used to produce a good or service |
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Term
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Definition
| cost of production that do not change when the rate of output is altered (e.g. the cost of basic plant and equipment) |
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Term
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Definition
| cost of production that change when the rate of output is altered (e.g. labor and material cost) |
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Term
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Definition
| total fixed cost divided by the quantity produced in a given time period |
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Term
| Average Variable Cost (AVC) |
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Definition
| total veriable cost divided by the quantity produced in a given time period |
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Term
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Definition
| total cost divided by quantity produced in a given time period |
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Term
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Definition
| the increase in total cost associated with a one unit increase in production |
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Term
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Definition
| accounting cost count dollar cost only and ignore any resource use that doesnt result in an explicit cost |
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Term
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Definition
| a payment made for the use of a resource |
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Term
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Definition
| the value of the resource used, even when no direct payment is made |
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Term
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Definition
| the most desired goods and services forgone in order to obtain something else |
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Term
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Definition
| whenever an increase in price reduces total revenue |
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Term
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Definition
| whenever an increase in price brings about an increase in total revenue |
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Term
| Unitary Elasticity (E = 1) |
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Definition
| whenever an increase in price brings about the same quantity of revenue |
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Term
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Definition
| a technological relationship expressing the maximum quantity of a good attainable from different combinations of factor inputs |
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