Chap 1 Flashcards
What is scarcity?
Scarcity is the fundamental economic problem facing all societies resulting from a combination of scarce resources and people’s virtually unlimited needs and wants.
What is economics?
Economics is the social science dealing with how people satisfy seemingly unlimited and competing needs and wants with the careful use of scarce resources.
What is a need?
A need is a basic requirement for survival, including food, clothing, and shelter.
What is a want?
A want is something we would like to have but is not necessary for survival.
What is a good?
A good is a tangible economic product that is useful, transferable to others, and used to satisfy wants.
What is a service?
A service is work or labor performed for someone; it includes economic products such as haircuts, repairs, and forms of entertainment.
What is utility?
Utility is the ability or capacity of a good or service to be useful and give satisfaction to someone.
What is Gross Domestic Product (GDP)?
Gross Domestic Product is the monetary value of all final goods, services, and structures produced within a country’s national borders during a one-year period.
What are the factors of production?
The factors of production are productive resources needed to produce goods; the four factors are land, capital, labor, and entrepreneurship.
Who are entrepreneurs?
Entrepreneurs are risk-taking individuals who introduce new products or services in search of profits; they are one of the four factors of production.
What is a Production Possibilities Curve?
A Production Possibilities Curve is a diagram representing all possible combinations of goods and/or services an economy can produce when all productive resources are fully employed.
What is opportunity cost?
Opportunity cost is the cost of the next best alternative use of money, time, or resources, when one choice is made rather than another.
What are trade-offs?
Trade-offs are alternatives that must be given up when one choice is made rather than another.
What is consumerism?
Consumerism is a social movement that was aimed at promoting the interests of consumers.
What is economic growth?
Economic growth is the increase in a nation’s total output of goods and services over time.
What is productivity?
Productivity is a measure of the amount of output produced in a specific time period with a given amount of resources; it normally refers to labor but can apply to all factors of production.
What is specialization?
Specialization is the assignment of tasks to the workers, factories, regions, or nations that can perform them most efficiently.
What is economic interdependence?
Economic interdependence is the mutual dependence of the economic activities of one person, company, region, or nation on those of another person, company, region, or nation.
What is cost-benefit analysis?
Cost-benefit analysis is the comparison of the cost of an action to its benefits.
What is a free enterprise economy?
A free enterprise economy is a market economy in which privately owned businesses have the freedom to operate for a profit with limited government intervention.
