Economic Principles
When a human want or need exceeds the limited resources needed to fulfil them.
Scarcity
The four factors of production
Land, Labor, Capital, Entrepreneurship
When you give up one thing in exchange for another.
Tradeoff
The point that shows an underutilization of resources.
A
Going to the gym, eating out with friends, playing at the park are all examples of this kind of desire.
The physical and mental effort put into creating a good or service.
Labor
I have a test tomorrow and plan on spending the night studying, but my friends invite me to the movie instead. I decide to skip out on studying. This is my opportunity cost.
Getting a good grade on tomorrows test.
The point that is impossible given this business' current resources.
E
When a human want or need is temporarily unavailable given the current level of demand
Shortage
The natural resources or physical space used in production.
Land
A government deciding to pull money out of their food programs, and put it into their army could be described as this kind of tradeoff.
Societal Tradeoff
A limitation of production possibilities curves.
Only two goods, assumes maximum efficiency, assumes technology and resources do not change.
The physical objects and helpful tasks that people buy, sell, and use in an economy.
Goods and Services
If a worker went to community college to gain more experience in a certain trade, they would be receiving this kind of capital.
Human capital
A type of decision making where you try to look for extra costs or benefits of something by adding one more or one less step.
Thinking at the Margin
The direction the curve would move if a plague wiped out all of the corn.
Left
The definition of Economics
The science of how people, businesses, and governments use unlimited resources to satisfy unlimited demands.
Elon Musk, Steve Jobs, Mark Zuckerberg could all be categorized as this factor of production.
Entrepreneurship.
I am a bartender and I realize that if I sell one more drink per night, then I can make an extra $1,000 per year. This would be my marginal cost.
The cost of making the drink.
The direction the curve would move if the company grew their resources, and was able to increase their working capacity.
Outward