| A | B |
|---|
| economics | the study of how we make and distribute wealth in our economy |
| scarcity | the inability to satisfy all wants at the same time |
| resources | factors of production used in the creation of goods and services |
| types of resources | natural, human, capitol, entrepreneurship |
| choice | selecting an item from a set of possible alternatives |
| opportunity cost | what is given up when a choice is made; the highest valued alternative foregone |
| production | the combining of resources to make goods/provide services |
| consumption | using goods and services |
| consumer sovereignty | when consumers determine what is produced through their purchases |
| incentives | things that motivate buyers |
| What incentives do | Incentives change economic behavior (increase the flow of ppl in a store_ |
| supply | the amount of a good or service a producer is willing and able to sell at a certain price |
| demand | the amount of a good or service a consumer is willing and able to buy at a certain price |
| price | the amount of money exchanged for a good or service |
| the interaction of supply and demand | determines the price of a good or service |
| entrepreneur | a person who takes a risk to start a business in search of a profit |
| profit | earnings after all expenses have been paid |
| equilibrium price | where the supply and demand meet |
| competition | rivalry between two or more businesses |
| the result of competition | is better quality goods at lower prices |
