The study of how people try to satisfy what appears to be seemingly unlimited and competing wants through the careful use of relatively scarce resources.
The condition that results from society not having enough resources to produce all the things people would like to have.
Land: Gifts of nature not created by humans including deserts, fertile field, forest, mineral deposits, livestock, sunshine and the climate necessary to grow crops.
The people with all their efforts, abilities, and skills.
The tools, equipment, machinery, and factories used in the production of goods and services. Also referred to as capitol goods to differentiate them from financial capitol which the money used to purchase tools and equipment used in production.
A person that takes risks to created a new product or service with hopes of making a profit.
simplified representations of the real world that are used to explain how the economy works, or to predict what would happen if something in the economy should change
Production Possibility Curve
shows the maximum combinations of goods and services that can be produced by an economy in a certain time period, given that all resources are used efficiently; used to illustrate opportunity cost
A model that shows the process of exchange among consumers (also called households), businesses and government