Glossary Terms:

Vincent van Gogh's 'Flower Beds in Holland'

Glossary terms from:
http://www.econedlink.org/e267


Choice

Decision made or course of action taken when faced with a set of alternatives.

Land

"Gifts of nature" that can be used to produce goods and services; for example, oceans, air, mineral deposits, virgin forests and actual fields of land. When investments are made to improve fields of land or other natural resources, those resources become, in part, capital resources. Also known as natural resources.

Money

Anything that is generally accepted as final payment for goods and services; serves as a medium of exchange, a store of value and a standard of value. Characteristics of money are portability, stability in value, uniformity, durability and acceptance.

Opportunity Cost

The second-best alternative (or the value of that alternative) that must be given up when scarce resources are used for one purpose instead of another.

Scarcity

The condition that exists because human wants exceed the capacity of available resources to satisfy those wants; also a situation in which a resource has more than one valuable use. The problem of scarcity faces all individuals and organizations, including firms and government agencies.

Trade-off

The giving up of one benefit or advantage in order to gain another regarded as more favorable.

Wants

Desires that can be satisfied by consuming or using a good or service. Economists do not differentiate between wants and needs.