9 Terms every Economics student should know

Supply and Demand: Fundamental economic model; prices rise when demand exceeds supply and fall when supply outstrips demand.

Inflation: General increase in prices; erodes purchasing power, affecting economies, wages, and standard of living.

Gross Domestic Product (GDP): Total value of goods and services produced in a country, key indicator of economic health and growth.

Monopoly: Market structure where a single seller dominates, controlling prices and supply, often leading to reduced competition.

Fiscal Policy: Government use of spending and taxation to influence economy; aims include stimulating growth or controlling inflation.

Market Economy: Economic system where supply, demand, and prices guide production, allocation, and distribution of goods and services.

Recession: Economic decline; characterized by reduced GDP, increased unemployment, and decreased consumer and business spending.

Opportunity Cost: Value of the next best alternative forgone when a decision is made; central to understanding economic choices.

Trade Surplus and Deficit: Surplus: Exports exceed imports, boosting economy. Deficit: Imports surpass exports, potentially causing economic challenges.