econ

oppertunity cost

, they mean the value of the next-highest-valued alternative use of that resource. If, for example, you spend time and money going to a movie, you cannot spend that time at home reading a book, and you cannot spend the money on something else.

physical capital

also known as inputs in the production function. The others are natural resources (including land), and labor — the stock of competences embodied in the labor force.

land

land comprises all naturally occurring resources whose supply is inherently fixed. Examples are any and all particular geographical locations, mineral deposits, forests, fish stocks, atmospheric quality, geostationary orbits, and portions of the electromagnetic spectrum.

production possibility curve

is a hypothetical representation of the amount of two different goods that can be obtained by shifting resources from the production of one, to the production of the other. The curve is used to describe a society's choice between two different goods.

scarcity

is the fundamental economic problem of having seemingly unlimited human wants in a world of limited resources. It states that society has insufficient productive resources to fulfill all human wants and needs.

thinking at the margin

means to think about your next step forward. The word "marginal" means "additional." The first glass of lemonade on a hot day quenches your thirst, but the next glass, maybe not so much. If you think at the margin, you are thinking about what the next or additional action means for you.

trade-off

n economics the term is expressed as opportunity cost, referring to the most preferred alternative given up. A tradeoff, then, involves a sacrifice that must be made to obtain a certain product, service or experience, rather than others that could be made or obtained using the same required resources.

law of increasing costs

principle that states that once all factors of production (land, labor, capital) are at maximum output and efficiency, producing more will cost more than average. As production increases, the opportunity cost does as well.

ecnonomic

the branch of knowledge concerned with the production, consumption, and transfer of wealth.

human capital

the collective skills, knowledge, or other intangible assets of individuals that can be used to create economic value for the individuals, their employers, or their community: Education is an investment in human capital that pays off in terms of higher productivity

need

Needs would be defined as goods or services that are required. This would include the needs for food, clothing, shelter and health care. Wants are goods or services that are not necessary but that we desire or wish for

efficiency

A broad term that implies an economic state in which every resource is optimally allocated to serve each person in the best way while minimizing waste and inefficiency. When an economy is economically efficient, any changes made to assist one person would harm another.

entreprenuer

An individual who, rather than working as an employee, runs a small business and assumes all the risk and reward of a given business venture, idea, or good or service offered for sale.

labor

a : expenditure of physical or mental effort especially when difficult or compulsory. b (1) : human activity that provides the goods or services in an economy (2) : the services performed by workers for wages as distinguished from those rendered by entrepreneurs for profits.

goods

a good is a material that satisfies human wants and provides utility, for example, to a consumer making a purchase. A common distinction is made between 'goods' that are tangible property (also called goods) and services, which are non-physical

serivces

a service is an intangible commodity. That is, services are an example of intangible economic goods. Service provision is often an economic activity where the buyer does not generally, except by exclusive contract, obtain exclusive ownership of the thing purchased.

capital

capital generally refers to financial wealth, especially that used to start or maintain a business. In classical economics, capital is one of three factors of production, the others being land and labor.

want

defined as desires that can be satisfied by consuming a good, service or leisure activity. Because resources are limited, people cannot have all the goods and services they want; as a result, they must choose some things and give up others.

factors of production

describe the inputs that are used in the production of goods or services in the attempt to make an economic profit. The factors of production include land, labor, capital and entrepreneurship.