Ch 1 - Scarcity Flashcards
A condition that results from society not having enough resources to produce all the things people want
Scarcity
The study of how people try to satisfy seemingly unlimited and competing needs and wants with the careful use of scarce resources
Economics
We have ____ resources yet ____ wants.
limited, unlimited
A basic requirement for survival, including food, clothing, and shelter.
A need
Something we would like to have but is not necessary for survival.
A want
A tangible economic product that is useful, transferable to other, and used to satisfy wants and needs.
A good
A good that lasts for at least 3 years when used regularly
Durable good
an item that wears out, is used up, or lasts for fewer than three years when used regularly
A nondurable good
a good intended for final use by consumers other than business
A consumer good
a tool, equipment, or other manufactured good used to produce other goods and services
a capital good
the work or labor performance for someone; an economic product that includes haircuts, home repairs, and forms of entertainment.
Service
the monetary worth of a good or service as determined by the market
value
the ability or capacity of a good or service to be useful and give satisfaction to someone
utility
Characteristics of Goods (4)
Tangibility
Scarceness
Utility
Transferability
the sum of tangible economic goods that are scarce, useful, and transferable from one person to another; excludes services
Wealth
3 Questions all societies face in regards to production
What to produce
How to produce
For Whom to produce
the monetary value of all final goods, services, and structures produced within a country’s national borders during a one-year period
Gross Domestic Product (GDP)
The scope of economics (4)
Description
Analysis
Explanation
Prediction
What does TINSTAFL stand for?
“There is no such thing as a free lunch”
The productive resources needed to produce goods
Factors of Production
What are the 4 factors of production
Land
Capital
Labor
Entrepreneurs
the natural resources or “gifts of nature” not created by human effort
natural resources
the tools, equipment, and factories used in the production of goods and services
Capital Resources
the people with all their abilities and efforts; does not include the entrepreneur
Labor resources
the risk-taking individuals who introduce new products or services in search of profits
Entrepreneurs
a diagram representing all possible combinations of goods and/or services an economy can produce when all productive resources are fully employed
Production Possibilities Curve
the cost of the next best alternative use of money, time, or resources, when one choice is made rather than another
Opportunity Cost
the alternative that must be given up when one choice is made rather than another
trade-off
5 economic rights humans have
Right to safety
right to be informed
right to choose
right to be heard
right to redress
a social movement that was aimed at promoting the interests of consumers
Consumerism
the increase in a nations total output of goods and services over time
Economic growth
the measure of the amount of output produced in a specific time period with a given amount of resources; normally refers to labor, but can apply to all factors of production
Productivity
the sum of people’s skills, abilities, health, and motivation
Human Capital
the division of work into a number of separate tasks to be performed by different workers
Division of Labor
the assignment of tasks to the workers, factories, regions, or nations that can perform them most efficiently
Specialization
the mutual dependence of the economic activities of one person, company, region, or nation on those of another person, company, region, or nation
Economic interdependence
the meeting place or mechanism through which buyers and sellers of an economic product come together; may be local, regional, national, or global
market
a market in which productive resources are bought and sold
Factor Market
a market in which goods and services are bought and sold
Product Market
comparison of the cost of an action to its benefits
Cost-benefit analysis
market economy in which privately owned businesses have the freedom to operate for a profit with limited government intervention
Free Enterprise Economy
