| A | B |
|---|
| Entrepreneurship | The ability and willingness to take risks to start a new business. |
| Goods | physical products |
| Services | actions performed for others. |
| Supply | The total amount of a particular product that is available. |
| Demand | The amount of a product that consumers want to buy. |
| Marginal Benefit | The additional satisfaction received from consuming one more unit of a good or service. |
| Marginal Cost | The additional cost or effort incurred to produce one more unit of a good or service. |
| Trade-off | occur when you give up something to gain something else. |
| Unintended consequences | unexpected outcomes—whether positive or negative—that result from a decision. |
| PACED decision-making model | a rational, five-step process for making thoughtful and informed choices, |
| Physical capital | the human-made assets used in the production of goods and services, such as machinery, buildings, equipment, and vehicles |
| Human capital | the skills, knowledge, and experience possessed by an individual |
| Capital | wealth in the form of money or other assets owned by a person or organization |
| Command economy | an economy in which production, investment, prices, and incomes are determined centrally by a government. |
| Traditional economy | an economic system in which production, distribution, and consumption are guided by customs, traditions, and beliefs rather than by money or modern technology |
| Market economy | an economic system in which production and prices are determined by unrestricted competition between privately owned businesses.Mixed economy - blends free-market capitalism and state-controlled command economy |
| Mixed economy | blends free-market capitalism and state-controlled command economy |
| Adam Smith | Father of Capitalism, wrote “The Wealth of Nations”. Said that people will act in their own interests and this will act as an invisible hand to guide the economy. |
| Dollar Votes | It is the idea that in a market economy, firms' success and failure are decided by consumers |
| Economics | The study of how people and societies make decisions about the production, distribution and consumption of goods and services, especially in the face of scarcity. |
| Scarcity | The fundamental economic problem that human wants and needs are unlimited, while the resources available to satisfy them are limited. |
| Needs vs. Wants | Things required for survival (food, water, shelter) vs things that individuals would like to have but can live without (a nice car, vacation home). |
| Incentives | Rewards or motivations that encourage people to act in a particular way. |
| Opportunity Cost | The value of the next best alternative that must be given up when a choice is made. |
| Factors of Production | The resources used to produce goods and services, including land, labor, capital, and entrepreneurship. |
| Land | Natural resources. |
| Labor | Human effort in production. |
| Capital | Money and other resources used to produce goods and services. |
| Choice | The condition that arises from unlimited wants and limited resources |
| Decision | A conclusion reached after considering alternatives and their results |
| Resources | Things that we have that are in limited supply and which may include personal resources (financial, skill, time) or productive resources (capital resources, human resources, natural resources and entrepreneurship) |
| Costs | What must be given up to obtain something. The effort, loss or sacrifice necessary to achieve or obtain something |
| Cost-benefit analysis | A process of examining the benefits (positive results) and costs (what is given up) of each available alternative in arriving at a decisionits ( |
| Diminishing marginal utility | A widely observed relationship in which the additional satisfaction (marginal utility) associated with consuming additional units of the same product in a given amount of time eventually declines |
| Marginal cost | The increase in a producer's total cost when it increases its output by one unit. The cost incurred by consuming one more of something |
| Human resources | The effort of people which is applied to production of goods and services |
| Benefits | Monetary or non-monetary gain received because of an action taken or a decision made |
