| A | B |
|---|
| Economics | Science that examines how goods and services are produced, sold, and used |
| Factors of Production | Economic resources a nation uses to make goods and supply services for its population. |
| Labor | Work performed by people in organization, also called human resource. |
| Capital | All the tools, equipment, and machinery used to produce goods or provide services. |
| Capital Goods | Products businesses use to produce other goods. |
| Entrepreneurship | Willingness and ability to start a new business. |
| Entrepreneur | Person who starts a new business or purchases an existing business. |
| Scarcity | When demand is higher than the available resources. |
| Trade off | When something is given up in order to gain something else |
| Opportunity Cost | Value of the next best option that was not selected |
| Systematic decision making | Process of choosing an option after evaluating the available information and weighing the costs and benefits of your alternatives. |
| Economic sytem | Organized way in which a nation chooses to use its resources to create goods and services. |
| Traditional economy | Economy in which economic decisions are based on a society’s values, culture, and customs. |
| Command Economy | Economy in which the government makes all the economic decisions for its citizens. |
| Market Economy | Economy in which individuals are free to make their own economic decisions, also known as free enterprise or private enterprise. |
| Capitalism | Economic system where the economic resources are privately owned by individuals rather than the government. |
| Mixed Economy | Economy in which both the government and individuals make decisions about economic resources. |
| Law of Supply and Demand | Economic principle that states the price of a product is determined by the relationship of the supply of a product and the demand for the product. |
| Competition | Actions taken by two or more businesses attempting to attract the same customers |
