| A | B |
|---|
| postive incentive | A reward or other enticement that encourages a behavior (e.g., price, wages) |
| negative incentive | a penatlty that discourages a behavior (library fine, parking ticket) |
| consumer sovereignty | the concept that consumers rule and buyers ultimately determine which goods and services remain in production |
| entrepreneurs | people who take calculated to start a new business and develop innovative products and processes. |
| costs | an amount paid to buy or obtain something. |
| cost of production | amounts paid for resources used to produce goods and services. |
| price | the amount consumers pay when they buy a good or service. |
| revenue | the income generated by the sales of goods and services (Price x Quantity) |
| profit | Total Revenue - Total Cost |
| productivity | the amount of output produced per unit of input used. |
| human capital | the health, education, experience, training, skills and values of people |
| technological changes | improvements in a firm's ability to produce due to improved processes, methods and machines |
| physical capital | an asset used in production that is made by humans, but is non-hjman |
| specialization | economic actors concentrate their skills on tasks at which they are the most skilled |
| GDP | market value of all final goods and services produced in a country in a calendar year |
| GDP per capita | market value of all final goods and services produced in a country in a calendar year divided by the total population |
| standard of living | the level of subsistence of a nation, social class - adequacy of necessities and comforts of daily life |
| circular flow | movement of output and income from one sector of the economy to another |
| product market | consumer goods and services - the things a consumers buy because they give them satisfaction |
| factor market | markets for input used in the production process |
