22 terms

First Econ Test

-describes how society chooses from among scarce resources
Economic Systems
-How every society answers these questions:
1.What is going to be produced?
2. How to produce them?
3. Whom will get what is produced?
-What you have to give up
-What you get because of a decision
Factors of Production
-Land, labor, capital, and entrepreneurship are examples
-A person who assumes risk in the market place
-The result of human wants exceeding our resources
Profit Motive
-The gain received because of an action or a decision; can be monetary or non-monetary
Sunk Cost
-where you put effort into something then it turns out to be worthless
-The return on land or property
Capital Goods
-Machinery and tools are examples of this
-Another word for satisfaction or enjoyment
Opportunity Cost
-What you give up to get something else
-the effort of the people to the production of goods and services
Trade Off
-Exchanging the benefit of one choice with a more favorable benefit of another
Production Possibilities Frontier
-Shows the decision between two choices where buyers and sellers interact
Law of Diminishing Marginal Utility
-Each unit brings less enjoyment
-next; next best____
Cost Benefit Analysis
-Examining the positive results and what is lost with each decision
Unintended Consequences
-The unexpected and unplanned results of a decision or action
Human Resources
-Skills and knowledge acquired through experience and/or decision
Natural Resources
-Referred to as "gifts of nature" that exist without human intervention