AQA AS Economics Unit 1 Key Terms
- Created by: Darren
- Created on: 28-05-13 18:23
Key terms
New words…..
Their meanings….
Opportunity cost
Value of what has to be given up to fulfil another want
Economic resources
Factors of production
Perfectly inelastic demand
Same quantity bought despite price
Perfectly elastic demand
Only one price paid despite quantity
Elasticity
How a good’s demand changes in relation to price
Functions of price mechanism
Rationing, signalling & incentive
Total revenue
PXQ
Marginal revenue
TR of 2nd lot – TR of 1st lot
Average revenue
TR/Q
Consumer surplus
Consumer could pay more for goods but doesn’t
Producer surplus
Producer could receive less
Productivity
Total output/no of workers
Economies of scale
Decreasing LRAC
Diseconomies of scale
Increasing LRAC
LRAC
Long Run Average Costs
Internal economies of scale
1 firm
External economies of scale
All firms in that industry
Monopoly
One firm produces all of that good
Duopoly
Two firms produce all of that good
Oligopoly
…
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