econ ch 1
Card Set Information
econ ch 1
The study of how scarce or limited resources are used to satisfy unlimited wants and needs; the study of decision making in a world of scarcity
The result of not enough goods and services to satisfy all wants and needs
Giving up one thing for something else
The relative importance one assigns to an action or alternative.
The cost of a purchase or decision measured in terms of forgone alternative; what was given up to make a purchase or carry out a decision.
Producing the largest attainable output of a desired quality with a given set of resources, producing at the lowest possible cost.
Justice or fairness in the distribution of goods and services.
Resources (factors of production)
Persons and things used to produce goods and services; limited in amount; categorized as labor, capital, land and entrepreneurship.
Physical and mental human effort used to produce goods and services.
Items, such as machinery and equipment, used in the production of goods and services
Productive inputs that orginate in nature, such as coal and fertile soil.
The function of organizing resources for production and taking the risk of success or failure in a productive enterprise.
Income return to labor
Income return to owners of capital
income return to owners of land resources
Income return to those performing the entrepreneurial function.
A formal explanation of the relationship between economic variables.
The setting within which an economic theory is presented.
Conditions held to be true within a mode.
The use of statistical techniques to describe the relationships between economic variables.
A guide for a course of action.
An illustration showing the relationship between two variables that are measured on the vertical and horizontal axes.
Two variables move in the same direction; when one increases, so does the other; graphs as an upward sloping line.
Two variables move in opposite directions; when one increases, the other decreases; graphs as a downward sloping line
Production Possibilities Table (or curve)
Gives the various amounts of two goods that an economy can produce with full employment and fixed resources and technology
Resources available for production are not being used.
An increase in an economy's full employment levle of output over time.
Goods such as machinery and equipment that are used to produce other goods and services.
Goods, such as food and household furniture, that are produced for final buyers.
The study of the operation of the economy as a whole
The study of individual decision making units and markets within the economy