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eco ch 1 review
| Term | Definition |
|---|---|
| scarcity | the condition that results from society not having enough resources to produce all the things people would like to have |
| need | a basic requirement for survival and includes food, clothing and shelter |
| want | a way of expressing a need to satisfy |
| factors of production | resources required to produce the things would like to have |
| land | gifts of nature |
| capital | tools, equipment, machinery, and factories used in the production of goods and services |
| financial capital | the money used to buy the tools and equipment used in production |
| labor | people with all their efforts abilities and skills |
| entrepreneur | a risk taker in search of profits who does something new with existing resources |
| production | process of creating goods and services |
| gross domestic product | the dollar value of all final goods and services and structures produced within a country's borders in a 12 month period |
| economic products | goods and services that are useful or satisfies an economic want |
| consumer good | intended for final use by individuals |
| capital goods | when manufactured goods are used to produce other goods and services |
| value | worth that can be expressed in dollars or cents |
| paradox of value | situation where some necessities have little monetary value where as non necessities have a much higher value |
| utility | capacity to be useful and provide satisfaction |
| wealth | accumulation of those products that are tangible, scarce, useful and transferable from one person to the another |
| market | location or other mechanism that allows buyers and sellers to exchange a certain economic product |
| factor markets | markets where productive resources are bought and sold |
| product market | markets where producers sell their goods and services to consumers |
| economic growth | occurs when a nations total output of goods and services increases over time |
| productivity | a measure of the amount of output produced by a given amount of inputs in a specific period of time |
| division of labor | work is arranged so that individual workers do fewer task than before |
| human capital | the some of the skills, abilities, health and motivation of people |
| economic interdependence | we rely on others and others rely on us to provide goods and service that we consume |
| trade-offs | alternative choices |
| opportunity cost | cost of the next best alternative use of money time and resources |
| production possibilities frontier | a diagram representing various combinations of goods and/or services an economy can produce when all productive resources are fully employed |
| cost-benefit analysis | a way of thinking about a problem that compares the cost of an action to the benefits received |
| free enterprise economy | one in which consumers and private owned businesses make the majority of decisions |
Created by:
dalizavez
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