| Term | Definition |
|---|
| wants | things people desire to have |
| resource | anything that is used to produce goods or services |
| scarcity | condition in which our wants are greater than the resources available to satisfy those wants |
| opportunity cost | most highly valued opportunity or alternative forfeited when a choice is made |
| trade-off | situation in which more of one thing necessarily means less of something else |
| production possible frontier | a graphich representation of all possible combinations of two goods that an economy can produce |
| rationing device | means for deciding who gets what portion of the available resources and goods |
| economics | science that studies the choices of peoople trying to satisfy their wants in a world of scarcity |
| marginal | economics: additional |
| incentive | something that encourages or motivates a person to take action |
| microeconomics | branch of economics that deals with human behavior and choices as they relate to relatively small units (an individual, a business firm, or a single market) |
| macroeconomics | branch of economics that deals with human behavior and choices as they relate to the entire economy |
| theory | explanation of how something works, designed to answer a question for which there is no obvious answer |
| tangible | able to be felt by touch (book) |
| intangible | not able to be felt by touch (lecture) |
| goods | anything that satisfies a person's wants or brings satisfaction |
| utility | quality of bringing satisfaction or happiness |
| disutility | quality of bringing dissatisfaction or unhappiness |
| services | tasks that people pay other to perform for them |
| land | all the natural resources found in nature |
| labor | physical and mental talents that people contribute to the production of goods and services |
| capital | produced goods that can be used as resources for further production |
| entrepreneurship | special talent that some people have for searching out and taking advantage of new business opportunities and for developing new products and new ways of doing things |
Combine with other sets
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