ECON chapter 1 Flashcards
Economics
The social science that studies how people satisfy seemingly unlimited and competing needs and wants with the careful use of scarce resources
Durable Good
A good that lasts for at least three years when used regularly.
Consumer Good
A good intended for final use by consumers other than businesses.
Service
Work or labor performed for someone.
Paradox of Value
Apparent contradiction between the high value of a nonessential item and the low value of an essential item.
Utility
Ability or capacity of a good or service to be useful and give satisfaction to someone.
Wealth
Sum of tangible economic goods that are scarce, useful, and transferable from one person to another; excludes services.
Factors of Production
Productive resources needed to produce goods and services. The four factors are capital, entrepreneurship, land, and labor. Use the acronym CELL to remember the four factors.
Capital
Tools, equipment, and factories used in the production of goods and services.
Entrepreneurship
Risk-taking individuals who introduce new products or services in search of profits.
Production Possibilities Curve
A diagram representing all possible combinations of goods and/or services an economy can produce when all productive resources are fully employed.
Opportunity Cost
The cost of the next best alternative use of money, time, or resources, when one choice is made rather than another.
Market
A meeting place or mechanism through which buyers and sellers of an economic product come together; may be local, regional, national, or global.
Factor Market
Market in which productive resources are bought and sold.
Product Market
Market in which goods and services are bought and sold.
