econ. first quiz/test

Factors of production- resources used to make all goods and services 

land- all natural resources used to produce goods or services

labor- effort a person devotes to a task for which that person is paid. 

Capital- any human-made resource used to create other goods or services 

human- skills and knowledge gained by a worker.

physical- human made objects used to create goods or services. 

Need- something essential for survival 

Want- something that people desire but that is not necessary for survival 

Goods- the physical objects that someone produces 

Services- the actions or activities that one person performs for another 

Scarcity- the principle that limited amounts of goods and services are available to meet unlimited wants 

economics- the study of how people seek to satisfy their needs and wants by making choices. 

Shortage- a situation in which consumers want more of a good or servicee than producers are willing to make available at a particular price 

Entrepreneur- a person who decides how to combine resources to create goods and services 

Factors of production- the resources that are used to make goods and services 

Land- all natural resources used to produce goods and services 

Labor-the effort people devote to task for which they are paid

Capital- any human made resource that is used to produce other goods and services 

Physical capital- the human made objects used to create other goods and services 

efficiency- the use of resource in such a way as to maximize tge output of goods and services

Human capital- the knowledge and skills a worker gains through education and experience 

trade offs- the act of giving up one benefit in order to gain another greater benefit.

production possibillties curve- a grapth that shows alternative ways to use an economys productive resources

opportunity cost- the most desirable alternative given up as the result of a decision

guns or butter- a phrase expressing the idea that a country that decides to prodce more military goods has fewer resources to produc consumer goods and vice versa

thinking at the margin- the process of deciding whether to do or use one additional unit of some resource