Chapter 1
the condition that results because people have limited resources but unlimited wants
Scarcity
These are the four factors of production
land, labor, capital, entrepreneurship
These are the three fundamental economic questions.
What to produce?
How to produce?
For whom to produce?
This is the act of willingly trading one item or service for another.
Voluntary Exchange
In this 1985 Nintendo game, players guide a plumber through various levels to rescue Princess Peach.
Super Mario Bros.
the exchange of one benefit or advantage for another that is thought to be better
tradeoff
the value of the next best alternative that is given up when making a choice
opportunity cost
custom and tradition dictate what to produce, how to produce it, and for whom, in this type of economic system.
Traditional Economy
This is the development of skills or knowledge in one aspect of a job or field of interest.
Specialization
This Netflix show features a group of kids from Hawkins, Indiana, who face supernatural threats from the "Upside Down."
Stranger Things
analysis used by people to make a decision and choose something when the benefits of doing so are greater than the costs
Cost-benefit analysis
a graph that shows all the combinations of two goods that can be produced with the resources and technology currently available
Production Possibilities Frontier (PPF)
A Mixed Economy combines characteristics from these TWO types of economic systems.
Command and (Free) Market Economies
This is the ability to perform at a at a lower opportunity cost than someone else; used to guide who produces what to best benefit society.
Comparative Advantage
In Greek mythology, this hero was dipped into the River Styx as a baby, making him invincible except for his heel.
Achilles
something that motivates a person to take a particular action
incentive
what is gained by adding/producing one more unit
marginal benefit
These are the six economic goals that steer societies on how to answer the fundamental economic questions.
Economic Freedom, Efficiency, Equity, Growth, Security, and Stability.
Name one economic benefit of free trade
lower prices/cost of goods
increases quantity/variety of goods
puts goods in the hands of those who value them
This dystopian novel by George Orwell, published in 1949, features a society under constant surveillance by "Big Brother."
1984
metaphor used by Adam Smith to explain how the economy coordinates to provide the "right" products at the "right" price based on consumer demands
the invisible hand
Every point on a PPF represents _______ use of resources to produce that specific combination of outputs
efficient
In the U.S., equal opportunity, profit motive, property rights, limited government, economic freedom, competition, and binding contracts are economic characteristics known as this type of system.
Free Enterprise
A political benefit of free trade is...
less conflict or war
Known as the "King of Pop," this artist is famous for hits like "Thriller," "Billie Jean," and "Beat It."
Michael Jackson