Studied by 2 people
need
something essential for survival
want
something we desire, but is not necessary for survival
goods
physical objects that someone produces
services
actions/activities that one person performs for another
scarcity
we have unlimited wants, but there is a limited amount of goods & services to meet those desires
economics
the study of how people seek to satisfy their needs & wants by making choices
consumer
a person purchasing goods/services
producer
the business making goods/services
shortage
when consumers want more of a good/service than producers are willing to provide
entreprenuer
a person who decides how to combine resources to create new goods & services
opportunity costs
the most desirable alternative someone gives up
land
‘gifts of nature’
capital
tools/equipment
labor
people.
communism
gov controls all aspects of the economy
socialism
gov. controls most aspects of the economy
capitalism
gov. does not frequently interfere w/ the economy.
market
buyers & sellers go to exchange
specialization
the concentration of productive efforts of individuals and businesses on a limited # of activities.
laissez-fair
the gov. should not interfere w/ the economy whatsoever.
circular flow model
how money moves in an economy from producer to consumer.
incentive
hope of reward or fear of punishment that encourages ppl to behave a certain way
command economies
the government makes all economic descisions
factor market
what individuals contribute to companies (workers)
product market
what businesses contribute to everyday households (goods & services)
self-interest
our personal gains
competition
the struggle among producers for the $$$ of consumers
free-market economy
individuals and businesses determine what is made, bought, and sold
mixed economy
some market-based elements and some gov. involvement
monopoly
one producer owns all of the supply
marginal analysis
an examination of the additional benefits compared to the costs.
efficiency
the use of resources to maximize the output of goods and services
law of increasing costs
increasingly expensive trade offs.
underutilization
any point inside of the production possibilities frontier
Note 
Flashcard (21)