Hon. Econ. - Chapter 1 - Introduction to Economics Flashcards

307639637	Need	something like air, food, or shelter that is necessary for survival	0
307639638	Want	an item that we desire but is not essential to survival	1
307639639	Economics	the study of how people seek to satisfy their needs and wants by making choices	2
307639640	Goods	physical objects such as clothes or shoes	3
307639641	Services	actions or activities one person performs for another	4
307639642	Scarcity	limited quantities of resources to meet unlimited wants	5
307639643	Shortage	a situation in which a good or service is unavailable, or a situation in which the quantity demanded is greater than the quantity supplied, also known as excess demand	6
307639644	Factors of production	land, labor, and capital; the three groups of resources that are used to make all goods and services	7
307639645	Land	natural resources that are used to make goods and services	8
307639646	Labor	the effort that people devote to a task for which they are paid	9
307639647	Capital	any human-made resource that is used to create other goods and services	10
307639648	Physical capital	all human-made goods that are used to produce other goods and services; tools and buildings	11
307639649	Human capital	the knowledge and skills a worker gains through education and experience	12
307639650	Entrepreneur	ambitious leader who combines land, labor, and capital to create and market new goods or services	13
307639651	Trade-off	an alternative or option we consider when we make a decision	14
307639652	Guns or butter	a phrase that refers to the trade-off that nations face when choosing whether to produce more or less military or consumer goods	15
307639653	Opportunity cost	the most desirable alternative given up as the result of a decision	16
307639654	Thinking at the margin	deciding whether to do or use one additional unit of some resource	17
307639655	Production possibilities curve	a curve that shows alternative ways to use an economy's resources	18
307639656	Production possibilities frontier	the line on a production possibilities graph that shows the maximum possible output for a specific economy	19
307639657	Efficiency	using resources in such a way as to maximize the production of goods and services	20
307639658	Underutilization	using fewer resources than an economy is capable of using	21
307639659	Cost	an alternative that is given up as the result of a decision	22
307639660	Law of increasing costs	as we shift factors of production from making one good or service to another, the cost of producing the second items increases.	23