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| The study of how people choose to use thier limited resources to satisfy their unlimited wants |
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| A system used to manage limited resources for the production, distribution, and consumption of goods and servies |
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| The branch of economics that uses objective ananlysis to find out how the world works. The goal is to describe how things are. |
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| The branch of economics that applies value judgements to data in order to recommend actions or policies. The goal is to advise how things ought to be done. |
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| The condition that results because people have limited resources but unlimited wants. |
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| The exchange of one benefit or advantage for another that is thought to be better. |
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| A way to compare the costs of an action with the benefits of that action. If benefits exceed costs, then the action is worth taking. |
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| Any factor that encourages or motivates a person to do something. Prices, taxes, and laws create incentives that influence how people behave. |
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| puzzles or riddles that might be explained through an economic analysis |
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| obscure or hard to understand |
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| anything used to produce an economic good or service |
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| economic decisions made by individuals, households, and businesses |
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| economics focusing on the workings of hte economy as a whole |
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| scarcity forces tradeoff principle |
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limited resources force people to make choices and force tradeoffs. Also known as the "no free lunch principle." Every choice, even free lunch involves tradeoffs. |
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| what you spend in time, money, and effort or other sacrifices |
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| what you gain from something in terms of money, time, experience, or other improvements in your situation |
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| cost versus benefits principle |
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| people choose something when the benefits of doing so are greater than the cost |
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| any arrangement that brings buyers and sellers together to do business with each other |
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| markets coordinate trade principle |
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| markets usually do better than anyone or anything else at coordinating exchanges between buyers and sellers |
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| future consequences count principle |
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| decisions made today have consequences not only for today but in the future |
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| poses a question, developing a hypothesis, conducting studies, gathering infomation, analyzing information, and evaluating hypothesis |
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| visual representation between two given sets of data |
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| quantity or data can vary or change |
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| each of the two perpendicular lines of coordinate system. x-axis is the horizontal line. y-axis is the verticle line. |
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| any line representing data points plotted on a graph--it doesn't have to be curved. |
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| a tool for understanding human behavior--people make decisions in ways that serve their own interests without taking into account the well being of others |
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| A simplified representation of reality that allows economists to focus on the efforts of one change at a time. It can be an equation, computer program, diagram, or written description. |
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