Untitled Flashcard Set

Scarcity

The condition where human wants are unlimited, but the resources available to satisfy those wants are limited.

Economic Resources

Inputs used to create goods and services, also known as Factors of Production.

Factors of Production

The ingredients required for any type of production to occur, also known as Economic Resources.

Opportunity Cost

The value of the next best alternative that is given up when a choice is made.

Capital Goods

Goods created to help in the production of other goods and services, rather than being bought by consumers.

Consumer Goods

Goods created for direct use or consumption by individuals for personal satisfaction.

Production Possibilities Curve (PPC)

A graph that shows the maximum combinations of 2 different products an economy can produce.

Constant Opportunity Cost

A situation where the cost of switching between 2 goods remains the same due to easily interchangeable resources.

Increasing Opportunity Cost

The principle that as you produce more of one good, you must give up increasingly larger amounts of the other good.