1. Basic Concepts Vocabulary
Know the terms AND how to apply them!

2. Vocabulary Week 1 Scarcity: Resources:
The basic economic problem that arises because people have unlimited wants but resources are limited
Resources:
An economic or productive factor required to accomplish an activity

3. Vocabulary Opportunity Cost: The value of the NEXT BEST alternative.
Alternatives: One of many different actions that we might take in a given situation.
Choices: The course of action we take when faced with a set of alternatives.

4. Vocabulary: Trade: a free exchange of goods or services
Utility: a measure of happiness or satisfaction
Efficiency: society getting the most it can from its scarce resources
Trade-off: giving up something that promotes one goal to get more of something that promotes another goal.

5. Vocabulary:
Market Economy: an economy that relies chiefly on market forces to allocate goods and resources and to determine prices
Command Economy: an economy in which production, investment, prices, and incomes are determined centrally by a government.