This is created by people's seemingly unlimited wants and relatively limited resources
Scarcity
Three basic economic questions are:
What to produce, How to produce, and For whom to produce
The four factors of production are:
Land, Labor, Capital, Entrepreneurs
They use goods and services to satisfy wants and needs
Consumers
These link buyers and sellers in the circular flow of economic activity
Markets
Next best alternative, or trade-off, in a decision
Opportunity Cost
A model that shows the various possible combinations of output that can be produced when all resources are fully employed
Production Possibilities Frontier
A way of thinking about a problem that compares the costs of an action to the benefits received
Cost-benefit Analysis
Provides insight as to how incomes are earned and spent, how jobs are created, and how the economy works on a daily basis
Study of Economics
A product intended for final use by an individual
Consumer Good
When some factors of production can perform tasks more efficiently than others
Specialization
Alternative Choices
Trade-Offs
A condition that results from society not having enough resources to produce all the things people would like to have
Scarcity
The next best alternative use of money, time, or resources when one choice is made rather than another
Opportunity Cost
Any product that lasts three or more years when used on a regular basis
Durable Good
The capacity to be useful and provide satisfaction
Utility
An individual risk taker in search of profit who does something new with existing resources
Entrepreneur
Factor of production that includes people, with all their efforts, abilities, and skills
Labor
The measure of the amount of output produced over a specific period of time
Productivity
An economic product that is performed for someone
Service
An economy in which consumers and privately owned businesses, rather than the government, make the majority of economic decisions
Free Enterprise Economy
True/False: Economic growth occurs when a nation's total output of goods and services increases over time
True
True/False: In economics, land refers to the natural resources needed for production, such as forests, minerals, and climate
True
True/False: Economic products consist of both goods and services that are useful, relatively scarce, and transferable to others
True
True/False: Division of labor increases efficiency because it allows workers to master many aspects of their jobs
False. Division of labor increases efficiency because it allows workers to master one aspect of their job
True/False: Economic interdependence limits a nation's growth and usually reduces the efficiency of production
False. Economic interdependence encourages a nation's growth and usually increases the efficiency of production
_____ describes the concept that everything we do has a cost
There Is No Such Thing As A Free Lunch (TINSTAAFL)
What, How, and For Whom to _____ are the three basic economic questions
Produce
The _____ of production include land, labor, capital, and entrepreneurs
Factors
_____ is a key measure of a nation's economic health
GDP
The study of _____ helps all of us to become more informed citizens and better decision makers
Economics
A _____-_____ grid can be used to evaluate alternatives
Decision-Making
The opportunity cost of doing something is the next best alternative, or _____-_____, that you give up
Trade-Off
A production possibilities frontier shows the various possible combinations of output that can be produced when all _____ are fully employed
Resources
When economic growth takes place, the _____ _____ _____ shifts outward, showing that more products are produced than before
Production Possibility Frontier
The study of economics helps people make better _____
Decisions