Chapter 3

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  Private Property: Any good that is owned by an individual or a business
• Public Property: Any good that is owned by the government.
• Household: An economic unit of one person or more that sells resources and buys goods and service.
• Circular Flow of Economic Activity: The economic relationships that exist between different economic groups in an economy.
• Profit: The amount of money left over after all costs have been paid.
• Loss: The amount of money by which total cost exceeds total revenue.
• Entrepreneur: A person who takes advantage of opportunities and organizes and manages a business(es)
• Contract: An agreement between two or more people to do something.
• Private Good: A good for which one person’s consumption takes away from another person’s consumption.
• Public Good: A good for which one person’s consumption does not take away from another person’s consumption.
• Excludable Public Good: A public good that individuals can be excluded or physically prohibited from consuming.
• Non-excludable Public Good: A public good that individuals cannot be excluded or physically prohibited from consuming.
• Free Rider: A person who recieves a benefit without paying for it.
• Negative Externality: An adverse side effect of an act that is felt by others.
• Positive Externality: A beneficial side effect of an act that is felt by others.
• Ethics: The principle of conduct, such as right/wrong, morality/immorality , good/bad