| A | B |
|---|
| Need | Something like air, food, or shelter that is necessary. |
| Want | An item that we desire but that is not essential to survival. |
| Economics | The study of how people seek to satisfy their needs and wants by making choices. |
| Goods | Physical objects such as shoes and shirts. |
| Services | Actions or activities that one person performs for another. |
| Scarcity | Implies limited quantities of resources to meet unlimited wants. |
| Shortage | Occurs when producers will not or cannot offer goods or services at current prices. |
| Factors of production | The resources that are used to make all goods and services. |
| Land | All natural resources used to produce goods and services. |
| Labor | The effort that a person devotes to a task for which they are paid. |
| Physical Capital | Human made objects used to create orther goods and services. |
| Human Capital | The knowledge and skills a worker gains through education and experience. |
| Entrepreneur | Ambitious leaders who decide how to combine land, labor, and capital resources to create new goods and services. Risk Takers. |
| Trade-off | All the alternatives that we give up whenever we choose one course of action over another. |
| Opportunity cost | The most desirable alternative given up as the result of a decision. |
| Production Possibilities Curve (Frontier) | A graph that shows alternative ways to use an economy's productive resources. |
| Efficiency | Using resources in such a way as to maximize the production or output of goods and services. |
| Traditonal Economy | An economy based on custom and tradition |
| Command Economy | An economy that relies on government officials to answer economic questions. |
| Market Economy | An economy where the Government has no say. Factors of production (resources) are owned by individuals. |
