3. Principles of Economics Production Economic Performance 1 Economic Performance 2 International Trade $100 $200 $300 $400 $500 $100 $200 $300 $400 $500 $300 $400 $500 Supply and Demand

4. _______ is the cost of what you give up to obtain an item.

5. Opportunity Cost

6. ________ is the cost you can never recover no matter

7. Sunk cost

8. ________ is the small or incremental amount you would pay extra to have more

9. Marginal Cost

10. Humankind has unlimited wants but our resources are limited thus creating the problem of ________

11. Scarcity

12. ___= revenue – cost of production

13. Profit

14. A ____ is anything an individual wants more of at zero price.

15. Good

16. Copper and iron are ______ natural resources.

17. Exhaustible

18. _____ is the study of how a society manages its scarce resources.

19. Economics

20. When you _______ in something, it means you focus on one task enabling you to be more efficient and productive.

21. Specialize

22. All factors of production are called ________

23. Capital resources or capital goods

24. Demand for a good exists only when consumers are both _____ and ____ to buy it

25. Willing and able

26. If elasticity is greater than 1.0, demand is ______.

27. Elastic

28. As substitutes become cheaper, demand for the normal good will _____

29. Decrease

30. _____ goods are goods that go together and usually sold together.

31. Complementary goods

32. A ______ exists when quantity demanded is lower than quantity supplied.

33. Surplus

34. When firms get together to fix prices and quantity it is called

35. Cartel

36. A profit-seeking individual who accepts all risk of success or failure in business

37. Entrepreneur

38. When 1 person or 1 group holds all market power in an industry

39. Monopoly

40. Who pays more taxes- a sole proprietor or a corporation?

41. Corporation

42. Legal obligation of a firm to pay off all debts

43. Liability

44. Which type of spending makes up 60% or more of our nation’s spending?

45. Consumption

46. Which type of GDP takes inflation into account- real or nominal?

47. Real

48. I’m thinking of a # 1-10. What is it?

49. 8

51. What are the 2 phases of a business cycle?

52. Expansion and recession

53. Which type of unemployment is caused by recession?

54. Cyclical

55. A point of reference to measure inflation

56. Consumer price index

57. _______ are taxes countries place on imported goods.

58. Tariffs

59. _______ is a free trade agreement among US, Mexico, and Canada

60. NAFTA

61. The ______ theory states that developing countries will eventually catch up with the industrialized countries.

62. Convergence Theory

63. Crude oil makes up ___% of our nation’s imports.

64. 17%

65. Make your wager Ms. So’s husband

66. In which city did the Rock play college football?

67. Miami