Chapter 1

• Wants: Somethimg that we desire to have.
• Resources: Anything that is used to produce goods or services.
• Scarcity: The condition in which our wants are greater than the resources available to satisfy them.
• Opportunity Cost: Being able to choose one thing but having to sacrifice/give up another thing for that.
• Trade-Off: A situation in which having more of one thimg necessarily means having less of something else.
• Production Possibilities Frontier (PPF): Shows what we can get.
• Rationing Device: A way to decide who gets what portion of all the resources and goods available.
• Economics: The science that studies the choices that people make as they try to satisfy their wants in a world of scarcity.
• Marginal: Economic definition of ”additional”.
• Incentive: A thing that motivates or encourages someone to do something/take action.
• Microeconomics: The branch of economics concerned with single factors and the effects of individual decisions.
• Macroeconomics: The study of the economy as a whole, including the production, distribution, and consumption of goods and services.
• Theory: An explanation of how something works, designed to answer a question for which there is no obvious answer.
• Tangible: Something that can be touched
• Intangible: Something that cannot be seen or touched.
• Goods: Anything that satisfies a persons wants.
• Utility: The ability to perform a task efficiently and effectively.
• Services: Tasks that people pay others to to perform for them.
• Land: All the natural resources found in nature.
• Labor: The physical and mental talents that people contribute to the production of goods and services.
• Capital : Produced goods that can be used as resources for further production.
• Entrepreneurship: The special talent that some people have for searching out and taking advantage of new business opportunities.
• Disutility: The quality of bringing dissatisfaction or unhappiness