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| Something people need that is necessary for survival |
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| An item we desire but that is not essential for survival |
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| The study of how people seek to satisfy their needs and wants by making choices |
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| The degree to which resources are being used efficiently |
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| The payment for the service of one unit of labor, usually per hour |
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| A fixed income which is usually paid on a weekly, biweekly, or monthly basis |
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| A person who makes goods and services avaliable to consumers |
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| A person who buys or uses goods and services |
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| A reward offered to try to persuade people to make certain economic actions |
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| Using fewer resources than an economy is capable of using |
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| Using fewer resources than an economy is capable of using |
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| A resource that IS capable of being naturally restored or replenished |
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| Actions one person preforms for another |
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| A tanglible object that can be bought and used to meet the needs and wants of consumers |
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| Limited resources to meet unlimited wants. Exists because our needs and wants are always greater than our resource supply. |
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| The most disirable alternative given up as a result of a decision |
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| An alternative we sacrifice when we make a decision |
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| All natural resources used to produce goods and services |
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| Any human made resource that is used to produce other goods and services. Either human or physical capital. |
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| The knowledge and skills a worker gains through education and experience |
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| Human made objects that create other goods and services |
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| Deciding whether to use one additional unit of some resource |
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| Ambitious leaders who decide how to combine land, labor, and capital resources to create new goods and services |
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| NOT the same as scarcity. This occurs when producers will not or cannot offer goods and services at the current prices (can be temporary or long term) |
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| Human effort directed toward producing goods and services (mental and physical efforts) |
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| Production Possibilities Curve |
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| A graph that shows alternative ways to use an economy's resources |
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| Production Possibilities Frontier |
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| A line on the production possibilities curve that shows maximum possible output for an economy |
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| A cost that remains the same no matter how many goods are produced |
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| The expenses that change with the number of goods produced |
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| Fixed costs plus variable costs |
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| The extra cost of producing one more unit of a good |
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| Improving a good or service |
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| Goods or raw materials used to make finished products |
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| The amount of money left over after all the costs of production have been paid |
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| An economic system in which private citizens own and use the factors of production |
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| Machines control production |
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| The breaking down of a job into seperate, smaller tasks, which are performed by different workers |
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| Goods brought into the market and not used in the production of other goods |
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| Competition is allowed to flourish with a minimum goverment interference |
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| Father of economics and author of "The Wealth of Nations" |
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| Takes place when people, businesses, regions, and even countries concentrate on goods and services that they can produce better than anyone else |
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| Law of Deminishing Marginal Returns |
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| A level of production in which the marginal product of labor decreases as the number of workers increases |
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| Machines perform physical tasks |
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| Working class employee who performs manual or unskilled labor |
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| Guides the nation's resources to their most productive use and helps the market to self-regulate itself |
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| A manufacturing process in which interchangeable parts are added to a product to create an end product |
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| Places where the prices of goods and services are determined as exchange takes place |
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| Perform tasks that require less physical labor/skilled workers |
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| "to let alone", the government should not interfere in the market place |
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| The idea that the consumer is the king or ruler of an economy and determines what products will be produced |
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| The struggle between buyers and sellers to get the best products at the lowest prices, keeps cost of production low and quality high |
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| In a free market economy, these own the factors of production and are the consumers of goods and services |
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| An orgranization that uses resources to produce a product which it sells, changes factors of production into products |
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| Firms purchase the factors of productions in this type of market |
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| Goods and services produced by firms are purchased by households in this type of market |
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