| A | B |
|---|
| want | An item that we desire but that is not essential to survival is |
| economics | the study of why people make one choice rather than another when buying and selling, spending and saving |
| scarcity | limited quantities of resources to meet unlimited wants---not enough to go around |
| shortage | a situation in which a good or service is unavailable |
| factors of production | land, labor, and capital |
| capital | any human made resource that is used to create other goods and services (ex, machines, tools and buildings) |
| physical capital | all human made goods that are used to produce other goods and services (ex. tools/buildings) |
| opportunity cost | choices made by people, businesses, and government. |
| microeconomics | the effects of economic forces upon individual parts of the economy |
| thinking at the margin | deciding whether to do or use one additional unit of some resource |
| production possibilities graph | a graph that shows alternative ways to use an economy's resources |
| underutilization | using fewer resources than an economy is capable of using |
