Economics Chapter 1 study questions

The situation in which some necessities have little value while some non-necessities have a much higher value

Paradox of value

Manufactured goods needed to produce other goods and services

Capital goods

To arrive at an economic decision, a decision-making grid may be used to evaluate _

Alternative choices of action

Division of labor is a characteristic of

Assembly line production

The study of economics is important because it enables us

To become better decision makers

The dollar value of all final goods, services, and structures produced within a country's borders in a single year is

Gross Domestic Product (GDP)

A popular model used to illustrate the concept of opportunity cost is

The production possibilities fronteir

An economy at its product possibilities fronteir is operating at

At full potential

Entrepreneurs are considered the driving force in an economy because

They start new business

Actions in one part of the country or world that have economic impact on what happens elsewhere are examples of

Economic independence

Worth that can be expressed in dollars and cents.

Value

Study of how people try to satisfy their needs through the careful use of scarce resources

Economic

Tools, equipment, machinery, and factories used in the production of goods

Capital

Condition of not having not enough resources to produce all the things people want

Scarcity

Cost of the next-best alternative use of money, time, or resources when one choice is made rather than another

Opportunity cost

Sum of those economic products that are tangible, scarce, useful, and transferable.

Wealth

People with all their efforts, abilities, and skills.

Labor

Alternative choices made by consumers in the marketplace.

Trade-offs

Quality of life based on the ownership of the necessities and luxuries that make life easier

Standard of living

Tangible item that is economically useful or that satisfies an economic want.

Good

Manufactured good that is used to produce other goos and services

Capital good

Process of using up goods and services to satisfy wants and needs

Consumption

Basic requirement for survival

Need

Something we would like to have, but is not necessary for survival

Want

Work that is performed for someone

Service

Diagram representing various combinations of goods and/or services that an economy can produce when all productive resources are fully employed

Production possibilities fronteir

A measure of the amount of goods and services produced with a given amount of resources in a specific period of time

Productivity

Where factors of production are bought and sold

Factor market

Any good that lasts three years or more when used regularly

Durable good

Economy in which consumers and privately owned businesses make the majority of the WHAT, HOW, and FOR WHOM decisions

Free enterprise economy