economics - 1. Unit

Allocation

Distributing resources for specific uses.

Command Economy

Economy where the government determines production and prices.

Competition

Rivalry between businesses to attract customers.

Consumer

Individual who buys goods or services for use.

Consumer Sovereignty

The power of consumers to decide what is produced by what they buy.

Deregulation

Removing government rules to help businesses compete.

Efficiency

Producing the most with the least waste.

Good

A physical object that can be purchased.

Government Regulation

Laws and rules used to manage economic behavior.

Growth

Increase in an economy's ability to produce over time.

Human Capital

The skills and knowledge of workers.

Incentives

Motivations that encourage people to act in certain ways.

Interdependence

Parties relying on each other for products and resources.

Labor

Physical and mental work used to provide goods and services.

Laissez-faire

A hands-off policy with no government interference.

Marginal Benefit

Extra satisfaction from getting 1 more unit of something.

Marginal Cost

The extra cost of producing 1 more unit.

Marginal Cost Analysis

Comparing extra costs and benefits to make better choices.

Market Economy

System where private businesses and competition set prices.

Market Failures

When a free market fails to allocate resources efficiently.

Mixed Economy

System combining private business and government action.

Natural Resources

Materials from nature used for economic gain.

Need

Something required for basic survival.

Opportunity Cost

The value of the next best choice given up.

Physical Capital

Tools, machines, and buildings used in production.

Producer

Someone who creates goods or services.

Production Possibilities Curve (PPC)

Graph showing the maximum output of 2 items.

Factors of Production

The 4 resources needed to produce: land, labor, capital, and entrepreneurship.

Productivity

A measure of how efficiently inputs are turned into outputs.

Profit Motive

The desire to earn money from business activities.

Property Rights

The legal right to own and control resources.

Public Goods and Services

Services from the government provided for everyone.

Rational Decisions

Choosing the option with the most benefit and least cost.

Scarcity

Limited resources vs. unlimited wants.

Service

Work or tasks done for other people.

Shortage

When demand is higher than supply at a set price.

Thinking at the Margin

Deciding whether to add or use 1 more unit.

Three Economic Questions

The 3 main questions: what to produce, how to produce, and for whom to produce.

Trade-off

Giving up one benefit to gain another.

Traditional Economy

Economy based on long-standing customs and beliefs.

Voluntary Exchange

Trading freely for the benefit of both buyers and sellers.

Want

Something desired but not necessary for survival.

Consumer Sovereignty

The power of consumers to decide what is produced by what they buy.

Deregulation

Removing government rules to help businesses compete.

Efficiency

Producing the most with the least waste.

Good

A physical object that can be purchased.

Government Regulation

Laws and rules used to manage economic behavior.

Growth

Increase in an economy's ability to produce over time.

Human Capital

The skills and knowledge of workers.

Incentives

Motivations that encourage people to act in certain ways.

Interdependence

Parties relying on each other for products and resources.

Labor

Physical and mental work used to provide goods and services.

Laissez-faire

A hands-off policy with no government interference.

Marginal Benefit

Extra satisfaction from getting 1 more unit of something.

Marginal Cost

The extra cost of producing 1 more unit.

Marginal Cost Analysis

Comparing extra costs and benefits to make better choices.

Market Economy

System where private businesses and competition set prices.

Market Failures

When a free market fails to allocate resources efficiently.

Mixed Economy

System combining private business and government action.

Natural Resources

Materials from nature used for economic gain.

Need

Something required for basic survival.

Opportunity Cost

The value of the next best choice given up.

Physical Capital

Tools, machines, and buildings used in production.

Producer

Someone who creates goods or services.

Production Possibilities Curve (PPC)

Graph showing the maximum output of 2 items.

Factors of Production

The 4 resources needed to produce: land, labor, capital, and entrepreneurship.

Productivity

A measure of how efficiently inputs are turned into outputs.

Profit Motive

The desire to earn money from business activities.

Property Rights

The legal right to own and control resources.

Public Goods and Services

Services from the government provided for everyone.

Rational Decisions

Choosing the option with the most benefit and least cost.

Scarcity

Limited resources vs. unlimited wants.

Service

Work or tasks done for other people.

Shortage

When demand is higher than supply at a set price.

Thinking at the Margin

Deciding whether to add or use 1 more unit.

Three Economic Questions

The 3 main questions: what to produce, how to produce, and for whom to produce.

Trade-off

Giving up one benefit to gain another.

Traditional Economy

Economy based on long-standing customs and beliefs.

Voluntary Exchange

Trading freely for the benefit of both buyers and sellers.

Want

Something desired but not necessary for survival.