Unit 1 Flashcards
Want
Desires that can be satisfied by consuming a good or service
Need
Things such as food clothing and shelter that are needed to survive
Scarcity
Does situation that exists when there are not enough resources to meet human wants
Economics
Study of how people choose to use scarce resources to satisfy their wants
Goods
Physical objects that can be purchased such as food clothing and furniture
Services
Work that one person performs for another for payment
Consumer
A person who buys goods or services for personal use
Producer
A person who makes goods or provides services
Factors of production
Economic resources needed to provide goods and services
Land
All the natural resources found on or underground that are used to produce goods and services
Labor
Do you mean time effort and talent that go into the making of products
Capital
All the resources made and use my people to produce and distribute goods and services
Physical capital
Resources made and used by people to produce goods and services
Human capital
The knowledge and skills gained through experience
Entrepreneur
Combination of vision skill in ingenuity and willingness to take risks that is needed to create and run a business
Trade off
The alternative someone gives up when making an economic choice
Opportunity cost
The value of something that is given of my choosing an alternative over another
Cost benefit analysis
The practice of examining the costs and then expected benefits of a choice as an aid to decision making
Marginal cost
Additional cost of producing are using one or more unit of a good or service
Marginal benefit
The benefit or satisfaction gain from using one or more unit of a good or service
Production possibilities curve
Graph used to illustrate the impact of scarcity on an economy
Efficiency
The condition in which economic resources are used to produce the maximum amount of goods
Underutilization
Condition in which I cannot make resources are not being used for their full potential resulting in fewer goods and services
Law of increasing opportunity cost
States that as production switches from one product to another increasingly more resources are needed to increase the production of the second product which causes opportunity cost to rise
