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Chapter 18
Term | Definition |
---|---|
NEED | Requirements for survival, such as food, clothing, and shelter. |
WANT | Things we would like to have. |
ECONOMICS | The study of how we make decisions is a world in which resouces are limited. |
MICROECONOMICS | The economics behavior and decision-making by indiduals and small businesses. |
MACROECONOMICS | Economic behavior and decison-making by goverment or whole industries or societies. |
ECONOMIC MODEL | A theory that tries to explain human economic behavior. |
ECONOMIC SYSTEM | Way of producing the things its people want and need. |
RESOURCE | The things used in making goods and providing services. |
SCARCITY | Occurs whenever we do not hace enough resources to produce all the things we would like to have. |
TRADE-OFF | The alternative you face if you decide to do one thing rather that another. |
OPPORTUNITY | The cost of the next best use of your time or money when you choose to do one thing rather than another. |
MARGINAL COST | The additional cost of producing one additional unit of output. |
MARGINAL BENEFIT | The additional satisfation or benefit received when one more unit is produced. |
COST-BENEFIT ANALYSIS | Economic model that compares the marginal costs and marginal benefits of a decision. |