Vocabulary
The study of how people choose to use their limited resources to satisfy their unlimited wants
Economics
What are the factors of production?
Land, Labor, Capital, Entrepenurship
what are the three Economic systems
Traditional, Command, and Market Economies
anything used to produce an economic good or service.
Resource
Land + labor + capital + entrepreneurship = goods and services.
Production equation
what is a Traditional Economy?
allocation of scarce resources, and nearly all other economic activity, stems from ritual, habit, or custom.
an arrangement that brings buyers and sellers together to do business with each other.
Market
Why is land important to the economy.
Farming, Businesses, and Resources
What is a Command Economy
a central authority makes most of the decisions in this economy.
the condition that results because people have limited resources but unlimited wants.
Scarcity
What is Physical Capital?
tools, machines, and buildings used in production of other goods or services
what is a free market economy
people and firms act in their own best interests to answer the what, how, and from whom questions.
a simplified representation of reality that allows economists to focus on the effects of one change at a time.
Economic Model
what is human capital
The human knowledge and skill people gain from education on job training and other experiences and those with more experience make more money than someone who doesn't know as much.
What is the cattle economy of the Massai
the economic system surrounded around their cattle for food, milk, and other stuff they can get from them