Ch 1 Review Econ – Flashcards
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*value
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worth that can be expressed in dollars and cents
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*economics
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study of how people try to satisfy their needs through the careful use of scarce resources
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*capital
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tools, equipment, machinery, and factories used in the production of goods and services
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*scarcity
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condition of not having enough resources to produce all the things people want
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scarcity
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*fundamental economic problem of meeting people's virtually unlimited wants with scarce resources
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*opportunity cost
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cost of the next-best alternative use of money, time, or resources when one choice is made rather than another
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*wealth
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sum of those economic products that are tangible, scarce, useful, and transferable
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*labor
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people with all their efforts, abilities, and skills
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*trade-offs
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alternative choices made by consumers in the marketplace
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*standard of living
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quality of life based on the ownership of the necessities and luxuries that make life easier
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*good
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tangible item that is economically useful or that satisfies an economic want
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*paradox of value
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the situation in which some necessities have little value while some non-necessities have much higher value is known as...
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*capital goods
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manufactured goods needed to produce other goods and services are called...
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need
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basic requirement for survival, including food, clothing, and shelter
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*alternative choices of action
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to arrive at an economic decision, a decision-making grid may be used to evaluate...
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*assembly line production
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division of labor is a characteristic of...
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*become better decision makers
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the study of economics is important because it enables us to...
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*- LABOR & entrepeneuership
- he observed that labor becomes more productive as each worker becomes more skilled at a single job
- developed division of labor
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What factor of production would Adam Smith be most likely to identify as the source of nation's wealth? Do you agree? Explain.
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*-UTILITY
you have to consider profit as well
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Why is cost, measured in dollars alone, an insufficient measure of value? What concept do economists use to better evaluate a decision? Why is it important?
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factors of production
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productive resources that make up the four categories of land, capital, labor, and entrepreneuers
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land
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natural resources or "gifts of nature" not created by human effort; one of the four factors of production
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capital
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tools, equipment, and factories used in the production of goods and services; one of the four factors of production
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labor
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people with all their abilities and efforts; one of four factor of production, does not include the entreprener
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entrepreneur
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risk-taking individual in search of profits
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gross domestic product (GDP)
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dollar value of all final goods, services, and structures produced within a country's borders a one-year period
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consumer good
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good intended for final use by customers rather than businesses
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durable good
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last for at least 3 years- used regularly
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non-durable good
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doesn't last for 3 years when used regularly
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value
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monetary worth of a good or service
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utility
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ability or capacity of a good or service to be useful and give satisfaction to someone
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factor market
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market where the factors of production are bought and sold
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product market
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markets where goods and services are bought and sold
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division of labor
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division of work into a number of separate tasks to be be performed by different wokrers
