vocab unit 1

Question 1

The study of choices and of the incentives behind those choices

Answer 1

economics

Question 2

A good or service that is necessary for survival

Answer 2

need

Question 3

A good or service that is desirable but is not necessary for survival

Answer 3

want

Question 4

A good sold to consumers that is expected to last for at least three years

Answer 4

durable good

Question 5

A good that is sold with the expectation that it will be consumed within three years

Answer 5

nondurable good

Question 6

A final good that is sold to the end user for their consumption

Answer 6

consumer good

Question 7

The physical objects used in the production or sale of a good or service.

Answer 7

capital good/physical capital

Question 8

The concept that desirable things have a limit to their quantity so we must make choices.

Answer 8

scarcity

Question 9

The resources that can be combined to create a business. Also called Productive Resources.

Answer 9

factors of production

Question 10

A graph that shows the different amounts of two goods or services that can be created at a given point in time.

Answer 10

production possibilities curve

Question 11

The idea that by choosing to use any resource in a given way, you have paid a cost equal to the next best alternative.

Answer 11

opportunity cost

Question 12

The idea that by choosing to use any resource in a given way, you give up the ability to use that resource for all of its other possible uses.

Answer 12

trade-off

Question 13

The knowledge, skills, and abilities that a person puts into the production or sale of a good or service.

Answer 13

human capital

Question 14

Choosing to focus on a limited number of tasks instead of trying to do everything.

Answer 14

specialization

Question 15

The quality of life experienced by the average person in any given area.

Answer 15

standard of living

Question 16

The idea that the marginal cost needed to continue gaining the same marginal benefit will eventually start to increase.

Answer 16

law of increasing cost

Question 17

An economic system that has its primary focus on maintaining current customs, methods and beliefs.

Answer 17

traditional economy

Question 18

An economic system that has its primary focus on maximizing individual choice and minimizing outside control.

Answer 18

market economy

Question 19

An economic system that has its primary focus on maximizing control and minimizing individual choice.

Answer 19

command economy

Question 20

An economic system that is a blending of the features from all other types of economic systems.

Answer 20

mixed economy

Question 21

The act of reducing or eliminating government control while moving towards greater private control of a business or industry.

Answer 21

privatization

Question 22

An economic system that has its primary focus on maximizing individual choice and minimizing outside control.

Answer 22

free enterprise

Question 23

Anything that influences people to either act or not act in a given way.

Answer 23

incentive

Question 24

The desire for financial gain that acts as an incentive to participate in any economy.

Answer 24

profit motive

Question 25

The idea that the customers are the ultimate decision makers who control an economy.

Answer 25

consumer sovereignty

Question 26

The additional amount produced after taking a given action.

Answer 26

marginal product

Question 27

The additional benefit gained from taking a given action, usually expressed in monetary terms.

Answer 27

marginal revenue

Question 28

The additional cost incurred from taking a given action.

Answer 28

marginal cost

Question 29

Any time in which a market fails to result in an efficient outcome.

Answer 29

market failure

Question 30

A good produced by the government for public consumption.

Answer 30

public good

Question 31

An unintended side effect that occurs with the use of any good or service.

Answer 31

externality

Question 32

The minimum amount of money needed to survive. Also called the Poverty Line.

Answer 32

poverty threshold