Basic Concepts
This term refers to the basic requirements for survival.
What is a need?
This type of market is where goods and services are bought and sold.
What is a product market?
This model shows how money, resources, and products are exchanged in an economy.
What is the Circular Flow Model?
This factor of production includes raw materials and natural resources.
What is land?
This cost represents what is given up when an economic decision is made.
What is opportunity cost?
This occurs when both utility and scarcity are present.
What is value?
This participant in the market uses goods and services to satisfy wants and needs.
What is a consumer?
This curve shows the combinations of goods an economy can produce.
What is the Production Possibilities Curve (PPC)?
The human resources used in production are classified as this factor.
What is labor?
The study of how people use scarce resources to satisfy unlimited wants and needs is the definition of this.
What is economics?
This concept describes a product's ability to be useful or provide satisfaction.
What is utility?
This type of market is where the factors of production are bought and sold.
What is a resource/factor market?
On a PPC, this point represents a combination that is impossible to attain under current conditions.
What is a point outside the curve?
Money invested to start a business falls under this category of factors of production.
What is capital?
These three questions must be answered by all economic systems due to scarcity.
What are "What to produce?"
"How to produce?"
"For whom to produce?"
This paradox states that wants are sometimes more valuable than needs.
What is the paradox of value?
In the circular flow model, households act as suppliers in this market.
What is the resource/factor market?
This event would cause the PPC to shift outward.
What is a technological advancement?
This factor of production takes risks and brings together the other factors to create a product or service.
What is an entrepreneur?
When making an economic decision, considering the value of the next best alternative is evaluating this.
What is the opportunity cost?
This fundamental problem is the reason all economic systems must answer the three basic economic questions.
What is scarcity?
This term describes the total amount of money spent by households on goods and services.
What are consumer expenditures?
In the circular flow model, this flow represents the payment for goods and services.
What is the flow from households to businesses in the product market?
Investing in education or job training is an example of improving this type of capital.
What is human capital?
This economic principle explains why a society can't have everything it wants and must make choices.
What is scarcity?