Econ test Ch 1

scarcity

unlimited wants and needs but limited resources

Opportunity cost

#1 trade off, next best thing

economics

choices made during scarcity

PPF- what are the assumptions

its a fixed snapshot in time

PPF- what concept does it show

opportunity cost

Factors of Production

LLC and me

L

land resources

L2

Labor (skilled or unskilled)

C

capital (tool being used)

Efficient

on the line: producing as much as you can

Inefficient

Under the line: not producing as much as possible

Unattainable

off the chart: impossible to produce with the resources you have

Reason PPF can grow/move to the right

List different things that help the company grow

Reason PPF can decline/move to the left

Things that hurt the business

Essential economic questions

what how and who to produce

Law of increasing opportunity cost

when you do the easy stuff first the opportunity cost is higher because you go faster

Law of diminishing returns

not getting as much satisfaction/less enjoyment