| A | B |
|---|
| trade-off | sacrificing one good or service for another |
| opportunity cost | value of the next best alternative |
| production possibilities curve | graph showing the maximum conbinations of goods and services that can be produced from a fixed amount of resources in a given period time |
| microeconomics | the branch of economic theory that deals with behavior and decision making by small units such as individuals and firms |
| macroeconomics | the branch of economic theory that deals with the economy as a whole and decision making by large units such as governments |
| economy | the production and distribution of goods and sevices in a society |
| economic model | a theory or simplified representation that helps explain and predict economic behavior in the real world |
| hypothesis | an assumption involving two or more variables that must be tested for validity |
