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| a viewpoint that envisions individuals and institutions making rational decisions by comparing the marginal benefits and marginal costs associated with their actions |
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| the amount of other products that must be forgone or sacrificed to produce a unit of a product |
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| the want-satisfying power of a good or service; the satisfaction or pleasure a consumer obtains from the consumption of a good or service (or from the consumption of a collection of goods and services) |
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| the social science concerned with how individuals, institutions, and society make optimal (best) choices under conditions of scarcity |
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| the comparison of marginal ("extra" or "additional") benefits and marginal costs, usually for decision making |
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| the procedure for the systematic pursuit of knowledge involving the observation of facts and the formulation and testing of hypotheses to obtain theories, principles, and laws |
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| a widely accepted generalization about the economic behavior of individuals or institutions |
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| other-things-equal assumption |
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| the assumption that factors other than those being considered are held constant; |
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| the part of economics concerned with decision making by individual units such as a household, a firm, or an industry and with individual markets, specific goods and services, and product and resource prices |
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| the part of economics concerned with the economy as a whole; with such major aggregates as the hosuehold, business, and government sectors; and with measures of the total economy |
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| a collection of specific economic units treated as if they were one. For example, all prices of individual goods and services are combined into a price level, or all units of output are aggregated into GDP |
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| the analysis of facts or data to establish scientific generalizations about economic behavior |
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| the part of economics involving value judgments about what the economy should be like; focused on which economic goals and policies should be implemented; policy economics |
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| the choices necessitated because society's economic wants for goods and services are unlimited but the resources available to satisfy these wants are limited (scarce) |
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| a line that shows the different combinations of two products a consumer can purchase with a specific money income, given the products' prices |
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| the land, labor, capital, and entrepreneurial ability that are used in the production of goods and services; productive agents; factors of production |
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| natural resources ("free gifts of nature") used to produce goods and services |
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| people's physical and mental talents and efforts that are used to help produce goods and services |
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| human-made resources (buildings, machinery, and equipment) used to produce goods and services; goods that do not directly satisfy human wants; also called capital goods |
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| in economics, spending for the production and accumulation of capital and additions to inventories |
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| the human resource that combines the other resources to produce a product, makes nonroutine decisions, innovates, and bears risks |
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| economic resources: land, labor, capital, and entrepreneurial ability |
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| products and services that satisfy human wants directly |
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| Human-made resources (buildings, machinery, and equipment) used to produce goods and services; goods that do not directly satisfy human wants; |
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| production possiblites curve |
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| a curve showing the different combinations of two goods or services that can be produced in a full-employment, full-production economy where the available supplies of resources and technology are fixed |
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| law of increasing opportunity costs |
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| the principle that as the production of a good increases, the opportunity cost of producing an additonal unit rises |
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Definition
1)an outward shift in the production possibilites curve that results from an increase in resource supplies or quality or an improvement in technology
2) an increase of real ouput (GDP) or real ouput per capita |
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