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Fundamentals of economics

Published on Aug 05, 2016

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1.

Fundamentals of economics

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2.

Economics

  • Study of how people seek to satisfy their needs and wants by making choices
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3.

Needs

nECESSARY THINGS FOR SURVIVAL
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4.

wants

Items that are desired but not NECESSARY to survive 
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5.

Goods

Physical objects such as shoes and shirts
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6.

services

Activities one person performs for another
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7.

Scarcity

Limited quantities of RESOURCES to meet unlimited wants 
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8.

Shortage

When producers will not and can't offer goods at price
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9.

opportunity cost

Most desirable alternative given up as the result of a decision
10.

Trade offs

alternative that is sacrifice when you choose one action over another
11.

Factors of production

Resources use to make up all good and services
12.

Land

All natural resources used to produce goods and services
13.

Labor

EFFORT A PERSON DEVOTES TO A TASK WHICH THAT PERSON IS PAID
14.

Capital

2 types: Physical and Human
15.

Physical capital

Human made objects used to create other goods and services
16.

Human Capital

KNOWLEDGE AND SKILLS A WORKER GAINS THROUGH EDUCATION AND EXPERIENCES
17.

Entrepreneurs

Takes a risk to start a business
18.

Marginal cost

additional cost of producing one more unit of a good
19.

Marginal benefit

additional value of consuming one more unit of a good

Cassie Cribbs