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Economics Voc Chpt1
Question | Answer |
---|---|
economics | the study of how people make choices about ways to use limited resources to fulfill their wants. |
microeconomics | the branch of economic theory that deals with behavior and decision making by small units such as individuals and firms. |
macroeconomics | the branch of economic theory dealing with the economy as a whole and decision making by large units such as governments. |
scarcity | basic economic problem that results from a combination of limited resources and unlimited wants. |
factors of production | resources of land, labor, capital, and entrepreneurship used to produce goods and services. |
land | natural resources and surface land and water. |
labor | human effort directed toward producing goods and services. |
goods | tangible objects that can satisfy people's wants or needs. |
services | actions that can satisfy people's wants or needs. |
capital | previously manufactured goods used to make other goods and services. |
productivity | the amount of output (goods and services) that results from a given level of inputs (land, labor, capital, and entrepreneurship). |
entrepreneurship | when individuals take risks to develop new products and start new businesses in order to make profits. |
technology | the use of science to develop new products and new methods for producing and distributing goods and services. |
trade-off | sacrificing one good or service to purchase or produce another. |
opportunity cost | value of the next best alternative given up for the alternative that was chosen. |
production possibilities curve | graph showing the maximum combinations of goods and services that can be produced from a fixed amount of resources in a given period of time. |
economy | the production and distribution of goods and services in a society. |
economic models | a theory or simplified representation that helps explain and predict economic behavior in the real world. |
hypothesis | an assumption involving two or more variables that must be tested for validity. (an educated guess or prediction) |
values | the beliefs or characteristics that a person or group considers important. )such as religious freedom, equal opportunity, individual initiative, freedom from government meddling and so on) |