aggregate
a collection of specific economic units treated as if they were one
budget line
a line that shows the different combinations of two products a consumer can purchase with a specific money income, given the products' prices
capital
Human-made resources used to produce goods and services; goods that do not directly satisfy human wants
capital goods
Human-made resources used to produce goods and services; goods that do not directly satisfy human wants
consumer goods
products and services that satisfy human wants directly
economics
the social science concerned with how individuals, institutions, and society make optimal choices under conditions of scarcity
economic growth (1)
an outward shift in the production possibilities curve that results from an increase in resource supplies or quality or an improvement in technology
economic growth (2)
an increase of real output per capita
economic perspective
a viewpoint that envisions individuals and institutions making rational decisions by comparing the marginal benefits and marginal costs associated with their actions
economic principle
a widely accepted generalization about the economic behavior of individuals or institutions
economic resources
the land, labor, capital, and entrepreneurial ability that are used in the production of goods and services; productive agents; the factors of production
economizing problem
the choices necessitated because society's economic wants for goods and services are unlimited but the resources available to satisfy these wants are limited
entrepreneurial ability
the human resource that combines the other resources to a product, makes nonroutine decisions, innovates, and bears risks
factors of production
economic resources: land, capital, labor, and entrepreneurial ability
investment
spending for the production and accumulation of capital and additions to inventories
labor
people's physical and mental talents and efforts that are used to help produce goods and services
land
natural resources used to produce goods and services
law of increasing opportunity costs
the principle that as the production of a good increases, the opportunity cost of producing an additional unit arises
macroeconomics
The part of economics concerned with the economy as a whole; with such major aggregates as the household, business, and government sectors; and with measures of the total economy
marginal analysis
the comparison of marginal benefits and marginal costs, usually for decision making
microeconomics
the part of economics study that looks at the behavior of people and organizations in particular markets
normative economics
the part of economics involving value judgments about what the economy should be like; focused on which economic goals and policies should be implemented; policy economics
opportunity cost
the amount of other products that must be forgone or sacrificed to produce a unit of a product
other-things-equal assumption
the assumption that factors other than those being considered are held constant
positive economics
the analysis of facts or data to establish scientific generalizations about economic behavior
production possibilities curve
a curve showing the different combinations of two goods or services that can be produced in a full-employment, full-production economy where the available supplies of resources and technology are fixed
scientific method
The procedure for the systematic pursuit of knowledge involving the observation of facts and the formulation and testing of hypotheses to obtain theories, principles, and laws.
utility
the want-satisfying power of a good or service; the satisfaction or pleasure a consumer obtains from the consumption of a good or service (or from the consumption of a collection of goods and services)