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factors of production
natural resources, Human Resources, capital resources, entrepreneurship
choice
ability of producers/consumers to decide among alternatives
trade-off
giving up one thing of value to gain another thing of value
production
organized process and activity of using factors of production to produce goods/services
specialization
devotion of resources to a specific task
production possibilities frontier
graph showing alternative combinations of amount two goods an economy can produce with specific inputs
innovation
new and better ways of doing something
incentives
motivations for behavior
steps of cost-benefit analysis (3)
identifying possible costs and benefits of an action, pricing costs and benefits (can include estimates), comparing total costs and benefits
marginal benefit
benefit a person, business, or government receives after the cost of an economic decision
marginal cost
cost of producing one more unit
innovation for a competitive edge
thrives as producers seek new ways to outdo other producers
bonuses
extra money usually tied to excellent work or seasonal gift
business grants
money given by the government to a business in need, doesn’t have to be paid back, used to encourage development and location within a community
paycheck
pay is an incentive, increase in pay is a great incentive
profit sharing
payments in money or stocks paid to employees when companies make a profit
promotions
increase in an employee’s responsibilities, usually higher pay, advances their position/career in a business
tax credits
amounts of money that can be deducted from income and reduce taxes
demotion
lowering an employee’s position and pay as punishment
dock in pay
taking money out of an employee’s pay for hours they didn’t work
fines and fees
punishment for wrong doing; paid when a service might not have been needed
distribution
the way total output is distributed among individuals in a population
