1. Pick up the Ch’s 1-2 Test Review from the black stand next to my desk and let’s get started.

2. Study of Scarcity and Choice
1) Economics
Study of Scarcity and Choice

3. 2) Utility
Satisfaction.

4. The operation of self-interest in an economy.
3) The Invisible Hand
The operation of self-interest in an economy.

5. When you give up something to get something else.
8) Trade Off
When you give up something to get something else.

6. 9) Productivity
Output per man-hour

7. 10) Positive Economics
Branch of economic analysis that describes how the economy actually works.

8. 11) Normative Economics
Branch of economic analysis that prescribes how the economy should work.

9. Branch of economics concerned with individual decisions.
12) Microeconomics
Branch of economics concerned with individual decisions.

10. 13) Macroeconomics
Branch of economics concerned with the overall ups and downs of the economy.

11. The technical means for the production of goods.
14) Technology
The technical means for the production of goods.

12. 15) Marginal Analysis
Cost vs. benefit analysis of doing a little more or little less of an activity.

13. The rewards or punishment for doing or not doing something.
16) Incentives
The rewards or punishment for doing or not doing something.