7 Principles of Economics
What you give up every time you make a decision
What are tradeoffs?
Production is determined by tradition, ritual, or custom.
What is a traditional market?
All natural resources
What is land?
Something that motivates a person to act in a certain way.
What is an incentive?
What is scarcity?
Government determines prices of all goods and services.
What is a command economy?
The man-made tools used for a good or service.
What is physical capital?
The idea we treat our own property better than public property.
What is Tragedy of the Commons?
Weighing your options, looking at advantages and disadvantages
What is a cost-benefit analysis?
This type of economy best describes the United States.
What is a mixed economy?
The knowledge, expertise, experience, etc. of a person.
What is human capital?
Do not consider past costs when making future decisions
What is sunk cost?
Deciding how to spend one more unit of a resource
What is thinking at the margin?
Government gets involved in the economy but does not control all aspects
What is mixed economy?
The work someone does in exchange for money.
What is labor?
Measures the efficiency of an economy.
What is the production possibilities frontier?
3 things we must know about an economy to identify what type of economy it is
What is production, distribution, and consumption?
There is the highest degree of consumer choice.
What is free market economy?
What are the FOUR factors of production?
What is land, labor, capital, and entrepreneurship?
The next best alternative.
What is opportunity cost?