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Absolute Advantage
The ability to produce more units of goods given a quantity of labor or resource inputs or the ability to produce more with less
Camparative advantage
the ability fo produce a good or service at a lower oppurtunity cost compared to other producers
Consumpsion
the use of goods or services for potential satisfaction
Division of Labor
The segregation of resources into different spedific tasks
Economic goods
goods that are scarce, for which the quantity demanded exceeds the quantity supplied at a zero price
Efficiency
the case in which a given level of inputs is used to produce the maximum output possible or goods are produced with minimum cost
Entrepreneurship
the component of human resources that performs for function of raising capital, organizing, managing, and assembling other factors of production, making basic business policy decisions, and taking risks.
Goods
all things from which individuals derive satisfaction or happiness
Human capital
the accumulated training and and education of workers
Inefficient point
any point below the ppc at which use of resources is not generating the maximum possible output
Labor
productive contributions of humans who work.
Land
the natural resources that are available from nature
Law of increasing relative cost
the observation that the oppurtunity cost of additional units of a good generally increases as a society attempts to produce more of that good. this accounds for the bowed out shape of the ppc
Oppurtunity cost
the highest valued next best alternative that must be sacrificed to attain something or to satisfy a want.
Physical capital
all manufactured resources including buildings, machines and improvements to land for production
production
any activity that results in the conversion of resources into products that can be used in consumption
Production Possibilities Curve
a curve representing all possible combinations of maximum outputs that could be produced assuming a fixed amount of productive resourcesof a given quality
Scarcity
a situation in which ingredients for producing the things that people desire are insufficient to satisfy all wants at a zero price
Services
mental or physical labor or help purchased by consumers.
specialization
the organization of economic activity so that what each person or region consumes is not identical to what that person or regions produces.
Technology
society's pool of applied knowledge concearning how goods and sevices can be produced.
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