Comparative advantage is when a firm or country produces a good at a lower opportunity cost than its competitors. This does not mean it has to produce it at a lower absolute cost, just relative to other goods it could🅰 be producing. This principle is what al🔯lows trade to enrich all participants.

Demand describes the amount of a good desired at a particular price. The demand for a good is inversely proportional to its price, all thi✃ngs being equal.

Microeꩵconomics is the study of economic decisions and phenomena at the level of an individual person or firm. This is in contrast with macroeconomics, which looks at economic decisions and phenomena on a larger scale, such as a whole country or the world.

An indifference curve is a graph th🌠at shows the array of combinations of two goods or services a person would be equally happy with. Curves are almost always concave, due to the diminishing marginal utility of most goods.

The marginal rate of substitution is the amount of one good that would be required to satisfy their demand for one additional unit of a substitute good. This rate defines an indif🐻ference curve between two goods, which shows the range of combinations of goods a peꦛrson would be equally happy with.

The tragedy of the commons is when a resource that ev♌eryone can 𝔉access but no one owns is damaged or destroyed due to overexploitation. This is because no one feels responsible for maintaining the resource, as others can benefit from it for free, and therefore insufficient investment goes into maintaining it.

Utility is the technical term for happiness o༺r enjoyment. One of the main basis of entry-level economics is that people will attempt to rationally maxim🌃ize their own utility.

Marginal utility is the additional happiness or satisfaction that a consumer gets from one additional unit of a good or service. Marginal utility usually diminishes, as, for example, going from not having a car to having one car significantly expand one's ones’ opportunity, but going from one to two does not have nearly as large an impact on the consumer’s life.

Economies of scale are when a firm increases the efficiency of its production the more it produces. Not all goods and services benefit from economies of scale, and productionꦓ only scales to a particular level before it reverses and each unit produced decreases efficiency. This is known as a diseconomy of scale.