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scarcity
the demand for goods is greater than the goods availability; manufacturers can’t meet needs of consumers
market economy
people and businesses control the economy
what’s being produced is based on what consumers are buying (trends)
private ownership of businesses
command economy
economy is run by central authority. controls production and buying patterns
often government run
marginal analysis
what is being lost per unit of output to receive a certain benefit. is the sacrifice worth it?
Law of Diminishing Returns
Returns (benefits) become lesser as units of output increase
margin
what is lost/gained per unit of output
CELL
acronym for the Four Resources/factors of production
capital
anything used to produce another good
tools
factories
entrepreneurship
(person) risk taking, initiative, organization
land
natural resources
OIL!!!
labor
the effort of workers
opportunity cost
everything given up to get something
$
NEXT opportunity/chance given up
financial/explicit cost
money given up
intangible/implicit cost
time or opportunity given up
positive statements
factual and measurable
normative statements
opinion based (unmeasurable)
aggregate
total/cumulative
Note 
Flashcard (83)