Econ test unit 1


unlimited wants, limited resources


Limited quantities of resources to meet unlimited wants

production possibilities curve

A graph that describes the maximum amount of one good that can be produced for every possible level of production of the other good.


work for money


An economic system based on private ownership of capital

trade off

an alternative that we sacrifice when we make a decision

capital good

tool, equipment, or other manufactured good used to produce other goods and services; a factor of production

opportunity cost

the most desirable alternative given up as the result of a decision

Public Sector

that part of the economy made up of the local, state, and federal governments


the impact of one person's actions on the well-being of a bystander