| A | B |
|---|
| Scientific method | Objective developement and testing of theories |
| Economic models | Simplifications of reality based on assumptions |
| Factors of production | Inputs such as land, labor, and capital |
| Opportunity cost | Whatever is given up to get something else |
| Efficiency | Getting maximum output from the resources available |
| Positive statements | Description of the world as is |
| Normative statements | Prescription of the world as it ought to be |
| Microeconomics | The study of how households and firms make decisions and how they interact in markets |
