Economics Unit 1

9. the limitation faced by consumers due to income and prices of goods
10. the condition where a consumer derives equal satisfaction from different combinations of two goods
13. A type of efficiency where resources are distributed to produce goods most wanted by consumers.
14. A cost or benefit that affects third parties not directly involved in a transaction.
16. The advantage a country has in producing a good at a lower opportunity cost than another country.
17. The state where it is impossible to make someone better off without making someone else worse off.
18. the point at which a consumer maximizes total utility by distributing their spending across goods in a balanced manner
19. The additional satisfaction or utility gained from consuming one more unit of a good.
20. A type of efficiency that occurs when firms innovate and improve over time to lower production costs.

1. A market situation where buyers and sellers have different information, leading to inefficient outcomes.
2. The expense incurred in producing one more unit of a good or service.
3. A situation where the market does not efficiently allocate resources.
4. the effect where a consumer switches to a cheaper good when the price of another increases
5. a line that shows the combination of two goods a consumer can buy within their income
6. The initial investment cost that later leads to greater efficiency.
7. the level of satisfaction derived from consuming goods and services
8. Goods that are under-consumed in a free market but beneficial for society, such as education or healthcare.
11. a good whose demand decreases when income increases
12. The lack of optimal resource use, resulting in lower output than potential.
15. the additional utility or satisfaction gained from consuming one more unit of a good