2. Economics: Principles and Applications, 2e by Robert E. Hall & Marc Lieberman

3. Chapter 2: Scarcity, Choice, and Economic Systems

4. The Concept of Opportunity Cost Opportunity Cost for IndividualsOpportunity Cost for Individuals Opportunity Cost and SocietyOpportunity Cost and Society Production Possibilities FrontiersProduction Possibilities Frontiers The Search for a Free LunchThe Search for a Free Lunch

5. The Concept of Opportunity Cost The opportunity cost of any choice is all that we forego when we make that choice.

6. The Concept of Opportunity Cost According to the law of increasing opportunity cost, the more of something we produce, the greater the opportunity cost of producing even more of it.

7. The Concept of Opportunity Cost Production Possibilities Frontier (PPF) A curve showing all combinations of two goods that can be produced with the resources and technology available.

8. The Concept of Opportunity Cost Productive Inefficiency A situation in which more of at least one good can be produced without sacrificing the production of any other good.

9. Economic Systems Specialization and ExchangeSpecialization and Exchange Resource AllocationResource Allocation Resource OwnershipResource Ownership Types of Economic SystemsTypes of Economic Systems

10. Economic Systems Comparative Advantage The ability to produce a good or service at a lower opportunity cost than other producers.

11. Economic Systems Three Methods of Resource Allocation Traditional EconomyTraditional Economy Command or Centrally Planned EconomyCommand or Centrally Planned Economy Market EconomyMarket Economy

12. Economic Systems Types of Resource Ownership CommunismCommunism SocialismSocialism CapitalismCapitalism

13. Economic Systems Economic System A system of resource allocation and resource ownership.