| A | B |
|---|
| economics | study of how individuals & nations make choices about how to use scarce resources to fulfill their wants |
| resource | anything people can use to make or obtain what they want |
| scarcity | people don't or can't have enough income, time, or other resources to satisfy their every desire, scarcity is not the same as shortage |
| wants | everything other than the basic needs |
| needs | food, clothing, shelter, also a good education and adequate health care |
| types of resources | land, labor, capital, entrepreneurship, technology |
| land | natural resources |
| labor | work people do, also called human resource |
| capital | all the property people use to make other goods & services, for example - machines used to make cars are capital |
| productivity | the ability to produce greater quantities of goods & services in better & faster ways |
| entrepreneurship | the ability of individuals to start new businesses, to introduce new products and techniques, and to improve management techniques |
| factors of production | the resource of land, labor, capital, & entrepreneurship together |
| goods and services | goods - items that people buy; services - activities done for others for a fee |
| technology | the use of science to develop new products and new methods for producing and distributing goods and services |
| trade-off | exchanging one thing for the use of another |
| opportunity cost | the value of the next best alternative that had to be given up for the alternative that was chosen |
| production possibilities | the combination of goods and services that can be produced from a fixed amount of resources in a given period of time |
| economy | all the activity in the nation that together affects the production, distribution, and use of goods and services |
| economic model | simplified representation of the real world |
| hypotheses | educated guesses or predictions used as the starting points for investigations |
| values | beliefs or characteristics that a person or group considers important, such as religious freedom, equal opportunity, individual initiative, freedom from want, etc. |
| generalizations | pulls together common ideas among facts and is true in most cases |
