A
With each tradeoff you make, you lose the benefit of the option you did not choose. The VALUE of the NEXT best alternative.
Opportunity cost
When we study how individuals and small groups of people make choices.
Microeconomics
The study of how people choose to use their limited resources to satisfy their unlimited wants and needs.
Economics
The activity of setting up a business or businesses, taking on financial risks in the hope of profit.
Entrepreneurship
Intangible activities done for us by others. (ex. teachers, doctors, plumbers, police officers)
Services
Something that motivates people to take a particular course of action.
Incentive
When we study how entire nations and governments make choices.
Macroeconomics
Tools, machines and buildings used in the production of other goods and services.
Capital
This results because people have limited resources but unlimited wants.
Scarcity
Making a choice of one thing over another.
Tradeoff
Three factors of production include:
Land, Labor, & Capital
Physical objects produced for sale. (ex. pencils, phones, shoes)
Goods
A way to compare the costs and benefits of an action.
Cost-benefit analysis
A system used to manage limited resources for the production, distribution, and consumption of goods and services
Economy
A measure of the output of an economy per unit of input.
Productivity