Economics flashcards

What this deck covers

• Topic 1: The Economic Problem (15 cards, 3 dot points)

  • Economic systems (SACE Stage 2 Economics) (5)
  • Scarcity, choice and opportunity cost (SACE Stage 2 Economics) (5)
  • The production possibility frontier (SACE Stage 2 Economics) (5)
• Topic 2: Microeconomics (19 cards, 4 dot points)

  • Demand, supply and market equilibrium (SACE Stage 2 Economics) (6)
  • Elasticity of demand and supply (SACE Stage 2 Economics) (6)
  • Market failure and government intervention (SACE Stage 2 Economics) (4)
  • Market structures (SACE Stage 2 Economics) (3)
• Topic 3: Macroeconomics (17 cards, 4 dot points)

  • Aggregate demand and aggregate supply (SACE Stage 2 Economics) (5)
  • Fiscal policy (SACE Stage 2 Economics) (3)
  • Growth, unemployment and inflation (SACE Stage 2 Economics) (5)
  • Monetary policy (SACE Stage 2 Economics) (4)
• Topic 4: Globalisation (9 cards, 3 dot points)

  • Effects of globalisation (SACE Stage 2 Economics) (3)
  • Exchange rates and balance of payments (SACE Stage 2 Economics) (3)
  • Trade and comparative advantage (SACE Stage 2 Economics) (3)

Sample cards from this deck

1. Definition

   Economic systems (SACE Stage 2 Economics)

   Define How

   How is decided by firms seeking the lowest-cost methods to maximise profit.

2. Definition

   Demand, supply and market equilibrium (SACE Stage 2 Economics)

   Define Demand falls

   Demand falls (shifts left): price down, quantity down.

3. Definition

   Aggregate demand and aggregate supply (SACE Stage 2 Economics)

   Define Long-run aggregate supply (LRAS)

   Long-run aggregate supply (LRAS) is vertical at the economy's potential output (full employment), because in the long run output is determined by the quantity and productivity of resources, not the price level.

4. Definition

   Effects of globalisation (SACE Stage 2 Economics)

   Define Globalisation

   Globalisation is the process by which the world's economies become more closely integrated through increased flows of trade, investment, finance, technology, ideas and labour across national borders.

5. Definition

   Scarcity, choice and opportunity cost (SACE Stage 2 Economics)

   Define Opportunity cost

   The value of the next best alternative that must be given up when a choice is made.

6. Definition

   Elasticity of demand and supply (SACE Stage 2 Economics)

   Define Elastic demand

   Elastic demand ($PED > 1$): quantity changes by a larger percentage than price. Buyers are very responsive.

7. Definition

   Growth, unemployment and inflation (SACE Stage 2 Economics)

   Define Gross Domestic Product (GDP)

   GDP is the total market value of all final goods and services produced within a country over a period of time. Real GDP adjusts this figure for changes in prices so that growth reflects changes in actual output.

8. Definition

   Exchange rates and balance of payments (SACE Stage 2 Economics)

   Define Current account deficit

   A current account deficit (CAD) occurs when the outflows on the current account (imports, income paid abroad) exceed the inflows (exports, income received). Australia has historically run a current account deficit, financed by inflows on the capital and financial account.

9. Definition

   The production possibility frontier (SACE Stage 2 Economics)

   Define Choice

   Choice is shown by selecting any point on the curve, deciding the mix of the two goods.

10. Definition

    Market failure and government intervention (SACE Stage 2 Economics)

    Define Negative externalities

    Negative externalities (such as pollution from a factory) impose costs on others. The market over-produces because private producers ignore the external cost. The socially optimal output is lower than the market output.