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14 Cards in this Set
- Front
- Back
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Trade-off
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the choice between alternative uses for a given quantity of a resource
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Allocation
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the different uses to which resources are put in order to produce different goods and services. The manner in which society allocates its scarce resources determines what it makes.
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Opportunity cost
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real economic cost of a good or service produced measured by the value of the sacrificed alternative.
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Production possibility frontier
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the line on a graph showing the different maximum output combinations of goods or services that can be obtained from a fixed amount of resources
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Underemployed resources
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resources that are not used to their fullest potential
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Infrastructure
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an economy’s stock of capital -- much of it publicly owned -- that provides basic services to produces and consumers. Includes such facilities as highways, electric power, water supplies, educational institutions, and health services.
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Efficiency
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maximizing the amount of output obtained from a given amount of resources or minimizing the amount of resources used for a given amount of output.
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Full employment
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employment of nearly everyone who desires to work. In practice, an unemployment level of not more than 4-5% is considered full employment.
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Price stability
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a constant average level of prices for all goods and services.
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Inflation
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a continuously rising general price level, resulting in a reduction in the purchasing power of money.
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Socioeconomic goal
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type of social goal that has important economic dimensions
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What are the three basic economic questions?
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-What are you producing?
-How are you going to produce it? -Who are you going to produce it for? |
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Name three factors that might influence what gets produced.
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-Government choices
-Consumer choices -Efficient production methods |
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What are a society’s four basic economic goals?
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-growth
-efficiency -full employment -price stability |
