1. Productivity: Output per person.
2. Malthusian vicious circle:
3. Average real wage: The wage adjusted for changes in price.
g
4. Stagnation: A prolonged period of slow economic growth, often with high unemployment.
5. Index: The value of something relative to its value at some other time.
6. Real: The money has been adjusted to take into account of the changes in prices over time.
Represents the real buying power.
fro
7. Net benefit: = enjoyment from doing it - cost of doing it
8. Opportunity cost: Value of the lost opportunity by doing the other thing.
9. Economic cost: = direct cost + oc
10.Economic rent: = net benefit from option taken - net benefit from next best (oc)
11.Innovation rent: = profit from using the new tech - profit if you use the same as your competitor
12.Economies of scale: producing a larger number of something is cheaper than producing a smaller
number of it.
13.Absolute advantage: More of something compared to the other person.
ol
14.Comparative advantage: Less oc of something compared to the other person.
15.APL:
16.Marginal product of labor:
17.Adam Smith:
18.Technological progress:
el
19.Production possibilities frontier:
20.Factors of production:
21.Production function:
22.Cost equation:
23.Isocost line:
24.Equilibrium:
th
25.Endogenous variable:
26.Ceteris paribus:
Firm: Owns or rents capital goods and employs workers to produce and sell goods and services.
Technology: The process that uses inputs (materials, labour, machines, energy) to produce an output.
Fixed-proportions technology: A production process where inputs must be used in specific fixed ratios to
produce output.
Constant returns to scale: When increasing all inputs by the same proportion increases output by the same
proportion.
Energy–labour ratio: The amount of energy used relative to labour to produce a given level of output.
2. Malthusian vicious circle:
3. Average real wage: The wage adjusted for changes in price.
g
4. Stagnation: A prolonged period of slow economic growth, often with high unemployment.
5. Index: The value of something relative to its value at some other time.
6. Real: The money has been adjusted to take into account of the changes in prices over time.
Represents the real buying power.
fro
7. Net benefit: = enjoyment from doing it - cost of doing it
8. Opportunity cost: Value of the lost opportunity by doing the other thing.
9. Economic cost: = direct cost + oc
10.Economic rent: = net benefit from option taken - net benefit from next best (oc)
11.Innovation rent: = profit from using the new tech - profit if you use the same as your competitor
12.Economies of scale: producing a larger number of something is cheaper than producing a smaller
number of it.
13.Absolute advantage: More of something compared to the other person.
ol
14.Comparative advantage: Less oc of something compared to the other person.
15.APL:
16.Marginal product of labor:
17.Adam Smith:
18.Technological progress:
el
19.Production possibilities frontier:
20.Factors of production:
21.Production function:
22.Cost equation:
23.Isocost line:
24.Equilibrium:
th
25.Endogenous variable:
26.Ceteris paribus:
Firm: Owns or rents capital goods and employs workers to produce and sell goods and services.
Technology: The process that uses inputs (materials, labour, machines, energy) to produce an output.
Fixed-proportions technology: A production process where inputs must be used in specific fixed ratios to
produce output.
Constant returns to scale: When increasing all inputs by the same proportion increases output by the same
proportion.
Energy–labour ratio: The amount of energy used relative to labour to produce a given level of output.
