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Economics
Economics is the social science that analyzes the production, distribution, and consumption of goods and services. Examines how people use their scarce resources to satisfy there unlimited wants TERM 2
Resources
DEFINITION 2 A resource is any physical or virtual entity of limited availability that needs to be consumed to obtain a benefit from it. The inputs or factors of production used to produce the goods and services that people want. TERM 3
Labor
DEFINITION 3 human effort, both physical and mental TERM 4
Capital
DEFINITION 4 Includes all human creations used to produce goods and services TERM 5
Natural Resources
DEFINITION 5 All gifts of nature
Renewable
Resource
Can be drawn on indefinitely if used conservatively TERM 7
Exhaustible
Resource
DEFINITION 7 does not renew itself and so is available in a limited amount TERM 8
Entrepreneurial Ability
DEFINITION 8 the talent required to dream up a new product or find a better way to produce an existing one TERM 9
Entrepreneur
DEFINITION 9 An entrepreneur is a person who has possession of a new enterprise, venture or idea and assumes significant accountability for the inherent risks and the outcome. TERM 10
Wages
DEFINITION 10 A wage is a compensation, usually financial, received by workers in exchange for their labor.
Scarcity
Scarcity is the fundamental economic problem of having seemingly unlimited human needs and wants, in a world of limited resources. TERM 17
Market
DEFINITION 17 A market is any one of a variety of different systems, institutions, procedures, social relations and infrastructures whereby persons trade, and goods and services are exchanged, forming part of the economy. TERM 18
Product Market
DEFINITION 18 a market where goods and services are bought and sold TERM 19
Resource Market
DEFINITION 19 a market in which a resource is bought and sold TERM 20
Rational Self Interest
DEFINITION 20 individuals try to maximize the expected benefit achieved with a given cost or to minimize the expected cost of achieving a given benefit
Marginal
incremental, additional. used to describe a change in an economic variable TERM 22
Microeconomics
DEFINITION 22 Microeconomics (from Greek prefix micro- meaning "small" + "economics") is a branch of economics that studies how the individual parts of the economy, the household and the firms, make decisions to allocate limited resources, typically in markets where goods or services are being bought and sold. TERM 23
Macroeconomics
DEFINITION 23 Macroeconomics (from Greek prefix "macr(o)-" meaning "large" + "economics") is a branch of economics that deals with the performance, structure, behavior and decision- making of the entire economy, be that a national, regional, or the global economy. TERM 24
Economic theory
DEFINITION 24 a simplification of reality used to make predictions about cause and effect in the real world TERM 25
Variable
DEFINITION 25 a measure that can take on different values at different times
Association-is-causation Fallacy
the incorrect idea that if two variables are associated in time, one must necessarily cause the other TERM 32
Fallacy of Composition
DEFINITION 32 the incorrect belief that what is true for the individual, or part, must necessarily be true for the group, or the whole TERM 33
Secondary Effects
DEFINITION 33 unintended consequences of economic actions that may develop slowly over time as people react to events
