Economics Ch 1-1,2,3

The need to make choices arises because

in a trade-off, opportunity cost is the value of the next best alternative

governmental "hands-off" policy concerning business and consumer affairs

value of the next best alternative given up for the alternative that was chosen

advance in knowledge leading to new and improved goods and services and better ways of producing them

a graph showing the maximum combos of goods and services made from fixed resources and time is

tangible objects that can satisfy people's wants and needs

sacrificing one good or service to purchase or produce another is

an assumption involving two or more variables that must be tested for validity

beliefs or characteristics that a person or group considers important

An economist's job is to offer solutions to economic problems.

economic models cannot judge whether policies are good or bad because judgments depend on values

different schools of economic thought exist because

Money that the government collects from citizens through taxes is revenue

previously manufactured goods used to make other goods and services

Human effort directed towards producing goods and services

economic models are useful because they show the way people react to changes in the economy

a simplified representation that helps explain and predict economic behavior is an economic model

to an economist, a want is

visual aid that helps business determine how best to use its resources

production and distribution of goods and services in a society

production possibilities example involving choices between military defense and civilian goods

The four factors of production are the resources of land, labor, capital, and entrepreneurship

Economics is the study of money

What is the basic problem of economics?

All economic choices involve trade-offs

The amount of military goods given up in a year is the opportunity cost for producing more civilian goods

what trade-off is involved when you buy a pair of shoes?

first step in creating an economic model is

As an economic term, land refers to