1. ECONOMICS Final-vocabulary review

2. UNIT 1 Basic Economic Concepts

3. The economic system where there is private ownership, consumer sovereignty, and minimal government involvement
Free-market economy

4. Things that excite or motivate people to change their economic behavior
Incentives

5. What is given up in order to get something
Opportunity cost

6. The most common type of economic system— combining free-market and command economies
Mixed-market economy

7. Things that can be grown or manufactured, then bought or sold
Goods

8. The using (up) of goods and services
Consumption

9. A limited supply of resources in comparison to unlimited wants and needs—it forces trade- offs
Scarcity

10. Selecting an item or action from a set of alternatives
Choice

11. The degree of availability of an item or service— how much there is available to consume
Supply

12. Things required for survival—food, water, shelter, etc.
Needs

13. Provided by nature, such as raw materials, land, or air
Natural resources

14. Rivalry between producers or sellers, resulting in a better quality good/service and/or lower price
Competition

15. Effort or work of producers; labor
Human resources

16. Things consumers would like to have such as cars, TV’s, and jewelry
Wants

17. The three basic questions any society/economy must ask—
1. What will be produced (and how much)?
Who will produce it?
For whom will it be produced?

18. UNIT II The Market Economy

19. The quantity of a good or service that consumers are willing and able to buy at various prices
Demand

20. The quantity of a good or service that producers are willing and able to offer for sale at various prices
Supply

21. An economic law stating that as prices of a good or service increases, the quantity demanded decreases ( and vice versa).
Law of Demand

22. An economic law stating that as prices of a good or service increases, the quantity supplied increases ( and vice versa).
Law of Supply

23. A product that satisfies the same basic want as another product—Coke or Pepsi.
Substitute good

24. A product that is used or consumed jointly with another product—PB & J.
Complimentary good

25. The measure of the degree of change in quantity demanded or supplied in response to change in price.
Elasticity

26. A minimum price set by the government to prevent prices from going too low.
Price floor

27. A maximum price set by the government to prevent prices from going too high.
Price ceiling

28. What is given up by adding one more unit to an activity.
Marginal cost

29. What is gained by adding one more unit to an activity.
Marginal benefit