Economic Terms

Productive Resources

What we Need to produce goods and services: natural resources, human resources, and capital resources combined

Scarcity

a good, service, or productive resource is scarce if there is not enough to satisfy all that people want at a zero price 1. The condition of not being able to have all of the goods and services one wants 2. Exists because human wants for goods and services exceed the quantity of goods and services that can be produced using all available resources 3. Exists on a global level as well as personal 4. Some resources are more scare than others, making them more valuable or cost more.

Capital Resources

goods produced and used to make other goods and services (buildings, machines, tools, equipment)

Natural Resources (Gifts of Nature)

present without human intervention (minerals, water, trees, land)

Human Resources (Labor)

quantity and quality of human effort directed toward producing goods and services

Entrepreneurship

the skill, ideas, and determination it takes to start a business and produce a product

Opportunity Cost

1. The opportunity cost of producing a particular good or service is the value of the best alternative given up 2. Always present when a country uses its productive resources.