2.  The study of how individuals, families, and businesses use limited resources to fulfill unlimited wants.  You must choose how to spend your time  Businesses must choose how many people to hire  Cities must choose how to use available land (factory or park?)

3.  Need: essential for survival (ex: food)  Want:everything that is NOT a need (ex: luxury car)

4.  SCARCITY (Looks like a quiz question to me)  There is a limited amount of EVERYTHING. (fresh water, beachfront property, IPods, etc).  SCARCITY means that people do not have and cannot have enough income, time, and other resources to satisfy their every want.  Economics, then, is the study of how we make choices.

5.  All resources that are used to produce a good or a service.  1. Land (Farmland, water, coal, forests)  2. Labor (Doctor, McDonald’s worker)

6.  3. Capital: Any man-made resource that is used to produce other goods and services.  2 Kinds:  A. Physical (factory, tools)  B. Human (education)…you are all increasing your own human capital right now! 4. Entrepreneurs: People that combine land, labor, and capital to create goods and services.