intro to econ vocab

economic system

A system for allocating (distributing) scarce resources

economy

The wealth and resources of a country or a region, especially in terms of the production and consumption of goods and services.

microeconomics

The study of the effect of individual decisions by individuals, households, and businesses regarding the allocation of scarce resources

macroeconomics

Macroeconomics is the study of the structure, behavior, and decision making that affect the economy as a whole

scarcity

Scarcity is the fundamental economic problem of having seemingly unlimited human wants and needs in a world of limited resources;

a limited amount of resources to meet unlimited wants and needs.

need

Something essential for survival

want

Something that people desire but is not necessary for survival

supply

The total amount of a specific good or service that is available to consumers

demand

Consumers’ desire to purchase goods and services and willingness to pay a price for a specific good or service

good

The physical objects that someone produces.

service

The actions or activities that one person performs for another.

trade-off

One goal or objective that must be given up in order to accomplish another goal or objective

The act of giving up one benefit in order to gain another, greater benefit.

opportunity cost

The value of time, money, goods, and services given up in an economic choice (the #1 alternative) is the opportunity cost.

The potential benefits an individual, investor, or business misses out on when choosing one alternative over another.

market

Any arrangement that allows buyers and sellers to exchange things