By Stephanie – [email protected]

Section 1

social science a science (the pursuit of systematic and formulated knowledge) that is applied to human behaviour

economics the study of how people use their limited resources in an attempt to satisfy unlimited wants

microeconomics the economics of individual parts or sectors of a national economy

macroeconomics the study of features of national economies

growth an increase the quantity that an economy is able to produce

development an improvement in the living standards of the average person in an economy

sustainable development economic development for one generation that will not impact negatively on the living standards of the next generation

utility the satisfaction derived from the use of a good or service

opportunity cost the cost of an economic decision in terms of the next best alternative foregone

production possibility curves a curve showing the maximum potential output of an economy that produces only 2 goods, with all available resources and best technology used to make either good

market economy an economy where resource allocation is determined mainly by market forces of demand and supply

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Section 2

monopolistic competition a market in which there are many buyers and many sellers, with very low barriers to entry and a degree of product differentiation

oligopoly an industry where there are a few large firms which take up majority of market share, significant barriers to entry and a very low degree of product differentiation

demand the quantity of a product than buyers are willing and able to buy at a given price per unit time

supply the quantity of a product suppliers are willing and able to supply at each price per unit time

maximum price a price ceiling (market restriction not ...

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