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24 Cards in this Set
- Front
- Back
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Need
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Something like air, shelter, or food that is necessary for survival
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Want
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An item that we desire but that is not essential to survival
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Economics
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the study of how people seek to satisfy their needs and wants by making choices
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Goods
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Physical objects such as clothes or shoes
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Services
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Actions or activities that one person performs for another
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Scarcity
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Limited quantities of resources to meet unlimited wants
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Shortage
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A situation in which a good or service is unavailable
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Factors of Production
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Land, Labor, and Capital; the three groups of resources that are used to make all foods and services
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Land
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Natural resources that are used to make foods and service
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Labor
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The effort that people devote to a task for which they are paid
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Capital
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Any human-made resources that is used to create other goods and service
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Physical Capital
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all human-made goods that are used to produce other goods and services; tools and buildings
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Human Capital
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The skills and knowledge gained by a worker through education and experience
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Entrepreneur
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Ambitious leader who combines land, labor, and capital to create and market new goods and services
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Trade-Off
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An alternation that we sacrifice when we make decisions
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Guns or Butter
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A phrase that refers to the trade-off that nations face when choosing whether to produce more or less military or consumer goods
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Oppurtunity Cost
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The most desireable alternative given up as the result of a decision
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Thinking at the Margin
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Deciding whether to do or use one additional unit of some resources
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Production Possibilities Curve
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A graph that shows alternative ways to use an economy's resources
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Production Possibilities Frontier
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The line on a production possibilities graph that shows the maximum possble output
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Effiiciency
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Using resources in such a way as to maximize the production of goods and services
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Underutilization
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Using fewer resources than an economy is capable of using
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Cost
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to an economist, the alternative that is given up because of a decision
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Law of Increasing Costs
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Law that states that as we shift factors of production from making one good or service to another, the cost of producing the second item increases
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