Section 1-3 Terms Flashcards Preview

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Flashcards in Section 1-3 Terms Deck (24)
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1

Something like air, food, or shelter that is necessary for survival

Need

2

An item that we desire but that is not essential to survival

Want

3

The study of how people seek to satisfy their needs and wants by making choices

Economics

4

Physical objects such as clothes or shoes

Goods

5

Action or activities that one person performs for another

Services

6

Limited quantities of resources to meet unlimited wants

Scarcity

7

A situation in which a good for service is unavailable

Shortage

8

Land, labor, and capital; the three groups of resources that are used to make all goals and services

Factors of production

9

Natural resources that are used to make good and services

Land

10

The effort that people devote a task for which they are paid

Labor

11

Any human made resource that is used to create other goods and service

Capital

12

All human made goods that are used to produce other goods and services; tools and buildings

Physical Capital

13

The skills and knowledge gained by a worker through education and experience

Human Capital

14

Ambitious leader who combines land, labor, and capital to create and market new goods and services

Entrepreneur

15

An alternative that we sacrifice when we make a decision

Trade-off

16

A phrase that refers to the trade-offs that nations face when choosing whether to produce more or less military or consumer goods

guns or butter

17

The most desirable alternative given up as the result of decision

Opportunity Cost

18

Deciding whether to do or use one additional unit of some resources

Thinking of the Margin

19

A graph that shows alternative ways to use an economy's resources

Production Possibilities Curve

20

The line on a production possibilities graph that shows the maximum possible output

Production Possibilities Frontier

21

Using resources in such a way as to maximize the production of goods and services

Efficiency

22

Using fewer resources than an economy is capable of using

Underutilization

23

To an economist, the alternative that is given up because of a decision

Cost

24

Law that states that as we shift factors of production from making one good or service to another, the cost of producing the second item increases

Law of Increasing Costs