Game Theory The mathematics of strategic interaction — players, payoffs, and equilibrium — from von Neumann's minimax theorem to Nash equilibria and evolutionary stability.
Externalities and Market Failure When production or consumption affects third parties outside the market, prices no longer reflect true social costs or benefits.
Opportunity Cost The value of the best alternative forgone when making a choice — the fundamental concept of economic scarcity.
Supply and Demand The model economists use to explain how prices and quantities are determined in competitive markets.
Inflation A sustained rise in the general price level: how it is measured, what causes it, and why central banks target low stable rates.
Price Elasticity of Demand How strongly quantity demanded responds to price, and why it decides who bears a tax and whether price cuts raise revenue.