Myanmar Matriculation Economics key terms

The condition in which available resources are limited while human wants are unlimited, so choices must be made about how to allocate resources among competing uses.

The value of the next best alternative forgone when a choice is made; what must be given up in order to obtain something else.

A curve showing the maximum combinations of two goods an economy can produce when all resources are fully and efficiently employed, illustrating scarcity, choice and opportunity cost.

The resources used to produce goods and services: land, labour, capital and enterprise, each earning a corresponding reward of rent, wages, interest and profit.

The quantity of a good or service that consumers are willing and able to buy at a given price over a given period, other things being equal.

The principle that, other things being equal, the quantity demanded of a good falls as its price rises and rises as its price falls, giving a downward-sloping demand curve.

A movement of the whole demand curve caused by a change in a non-price determinant such as income, tastes, population or the price of related goods.

The quantity of a good or service that producers are willing and able to offer for sale at a given price over a given period, other things being equal.

The principle that, other things being equal, the quantity supplied of a good rises as its price rises and falls as its price falls, giving an upward-sloping supply curve.

A movement of the whole supply curve caused by a change in a non-price determinant such as input costs, technology, taxes or subsidies.

The price at which the quantity demanded equals the quantity supplied, so there is no tendency for the price to change and no shortage or surplus exists.

A situation where quantity demanded exceeds quantity supplied at a price below equilibrium, creating a shortage that tends to push the price upward.

A situation where quantity supplied exceeds quantity demanded at a price above equilibrium, creating a surplus that tends to push the price downward.

The responsiveness of quantity demanded to a change in price, measured as the percentage change in quantity demanded divided by the percentage change in price.

The responsiveness of quantity demanded to a change in consumer income, measured as the percentage change in quantity demanded divided by the percentage change in income.

The responsiveness of quantity supplied to a change in price, measured as the percentage change in quantity supplied divided by the percentage change in price.

A good whose demand increases when consumer income rises, so that it has a positive income elasticity of demand.

A good whose demand falls when consumer income rises, so that it has a negative income elasticity of demand as consumers switch to better substitutes.

The satisfaction or benefit a consumer derives from consuming a good or service; marginal utility is the extra satisfaction gained from consuming one additional unit.

The principle that as a consumer consumes more units of a good in a given period, the additional satisfaction from each extra unit tends to fall.

The combination of goods a consumer chooses that maximises total satisfaction given a limited income and given prices, where marginal utility per unit of money is equal across goods.

A cost that does not vary with the level of output in the short run, such as rent or insurance, and is incurred even when output is zero.

A cost that changes directly with the level of output, such as spending on raw materials and hourly labour, rising as more is produced.

The addition to total cost resulting from producing one more unit of output, calculated as the change in total cost divided by the change in quantity.

The fall in long-run average cost that occurs as a firm's scale of production increases, arising from specialisation, bulk buying and better technology.

The rise in long-run average cost that can occur when a firm grows too large, caused by management difficulties, poor communication and reduced worker motivation.

A market structure with many small firms selling an identical product, free entry and exit, and perfect information, so each firm is a price taker.

A market structure in which a single firm supplies the whole market for a good with no close substitutes, giving it power to set price and restrict output.

A firm that must accept the market price determined by industry demand and supply and cannot influence that price by its own output decisions.

A firm with market power that can influence the price of its product by choosing its output level or by other pricing decisions.

The total market value of all final goods and services produced within a country's borders during a given period, usually a year.

The total income earned by the factors of production owned by a country's residents, used as a measure of the economy's output and income.

Gross domestic product measured at constant prices, adjusted to remove the effect of inflation so that changes reflect changes in actual output.

A situation in which people who are willing and able to work at the going wage cannot find jobs, measured as a proportion of the labour force.

A sustained rise in the general price level of goods and services in an economy over a period, reducing the purchasing power of money.

Any asset generally accepted as a medium of exchange, a unit of account, a store of value and a standard of deferred payment.

The institution that manages a country's money supply, issues currency, acts as banker to government and commercial banks, and conducts monetary policy.

A financial institution that accepts deposits from the public, makes loans and provides payment services, thereby creating credit money through lending.

The use by the central bank of interest rates, reserve requirements and open market operations to influence the money supply, credit and aggregate demand.

The use of government taxation and public spending to influence the level of aggregate demand, output, employment and the distribution of income.

A tax levied directly on the income or wealth of individuals and firms, such as income tax, where the burden cannot easily be shifted.

A tax levied on goods and services, such as a sales tax or customs duty, which raises the price paid by consumers and can be partly shifted.

A systematic record of all economic transactions between a country's residents and the rest of the world over a period, comprising current and capital accounts.

The price of one country's currency expressed in terms of another currency, determined by demand and supply in the foreign exchange market.

A fall in the value of a country's currency against another currency under a floating exchange rate, making exports cheaper and imports dearer.

A broad improvement in living standards involving rising income per head together with better health, education, infrastructure and reduced poverty and inequality.

An increase in a country's real output of goods and services over time, usually measured by the annual percentage change in real GDP.

A composite measure of development combining average income, life expectancy and education, used to compare welfare across countries beyond GDP alone.