Absolute (Money) Price

Marginal Rate of Substitution The
amount of one good an individual is willing
to give up to obtain an additional unit of
another good and maintain equal total utility.
Marginal Revenue (MR) The change in
total revenue (TR) that results from selling
one additional unit of output (Q ).
Marginal Revenue Product (MRP) The
additional revenue generated by employing
an additional factor unit.
Marginal Social Benefits (MSB) The
sum of marginal private benefits (MPB) and
marginal external benefits (MEB): MSB 5
MPB 1 MEB.
Marginal Social Costs (MSC) The
sum of marginal private costs (MPC ) and
marginal external costs (MEC ): MSC 5
MPC 1 MEC.
Marginal Utility The additional utility a
person receives from consuming an additional unit of a good.
Market Any place people come together to
trade.
Market Coordination The process in
which individuals perform tasks, such as
producing certain quantities of goods, based
on changes in market forces, such as supply,
demand, and price.
Market Failure A situation in which the
market does not provide the ideal or optimal
amount of a good.
Market Structure The environment of
a firm, whose characteristics influence the
firm’s pricing and output decisions.