Intro to Economics
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Created by:
horsedreamer194 on December 5, 2011
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18 terms
Terms | Definitions |
|---|---|
 Trade-off | the alternative you face if you decide to do one thing rather than another |
| Economic Model | simplified representation of the real world that economists develop to describe how the economy behaves and is expected to perform in the future |
| Cast-Benefit Analysis | economic medal that compares the marginal costs and marginal benefits of a decision |
| Marginal Cost | the additional or extra opportunity cost associated with an action |
| Capitalism | another name for market economy and is an economic system in which private citizens own most, if not all, of the means of production, and decide how to use them within legislated limits. |
| Free enterprise | another name for market economy and is an economic system in which individuals and businesses are allowed to compete for profit with a minimum of gov't interference |
| Natural resources | gifts of nature that make production possible |
| Profit | the money a business receives for its products or service over and above its costs |
| Traditional economy | economic system in which basic economic decisions are made by systems passed down from generation to generation (hunting and gathering) |
| Command Economy | economic system in which the government or central authority make economic decisions |
| Market economy | economic system in which private individuals own the factors of production and able to make economic choices |
| Mixed economy | economic system where the individual with some government involvement make economic decisions |
| Scarcity | not having enough resources to produce all of the things we would like to have |
| Entrepreneur | individual who starts a new business introduces a new product and improves a management technique |
| Factors of production | resources necessary to produce goods and services |
| Capital | previously manufactured goods used to make others foods and services |
| Opportunity Cost | the cost of the next best alternative use of time and money when choosing to do one thing rather than another |
| Gross Domestic Product | total dollar value of all final goods and services produced in a country during a single year. |
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