Unit 2 Flashcards
Things that we can touch and hold.
Goods
are all the things that can be used in making products or services that people want.
Services
Occurs whenever we do not have enough resources to produce all of the things we would like to have
Scarcity
financial motivations for people to take certain actions
Incentive
the monetary value of goods and services that producers and consumers purchase
Costs
is any benefit that we can quantify in terms of the money that it generates
Benefits
includes workers and their abilities. The more workers a society has, the more it can produce. Workers’ knowledge and skills are important, too. The more workers know and the better their skills are, the higher the quality of goods and services they produce.
Labor
is giving up one alternative good or service for another.
Trade off
is the cost of the next-best use of your money or time when you choose to do one thing rather than another.
Opportunity cost
the surplus earned above the normal return on capital.
Profit
economic model that compares the marginal costs and marginal benefits of a decision and is best for deciding between two or more projects
Cost-Benefit Analysis
Businesses produce goods based on consumer’s demands.
Mixed economies
planners who work for the government answer the economic questions. They decide what will be produced, for example whether the society will produce machines or consumer goods.
Command Economies
the amount of a good or service that producers are willing and able to sell over a range of prices
Supply
the amount of a good. or service that consumers are willing and able to buy over a range of prices
Demand
