Glossary Terms:

Green Eggs and ...Economics?

Glossary terms from:
http://www.econedlink.org/e966


Choice

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

Competition

Attempts by two or more individuals or organizations to acquire the same goods, services, or productive and financial resources. Consumers compete with other consumers for goods and services. Producers compete with other producers for sales to consumers.

Complements

Goods and/or services that are often consumed together; e.g., left and right socks, or tennis rackets and tennis lessons.

Costs

An amount that must be paid or spent to buy or obtain something. The effort, loss or sacrifice necessary to achieve or obtain something.

Demand

The quantity of a good or service that buyers are willing and able to buy at all possible prices during a period of time.

Division of Labor

An arrangement in which workers perform only one step or a few steps in a larger production process (as when working on an assembly line).

Economics

The study of how people, firms and societies choose to allocate scarce resources with alternative uses.

Exchange

Trading a good or service for another good or service, or for money.

Externalities

Economic side-effects or third-party effects, in which some of the benefits or costs associated with the production or consumption of a product affect someone other than the direct producer or consumer of the product. Can be positive or negative.

Goal

Something a person or organization plans to achieve in the future; an aim or desired result.

Goods

Tangible objects that satisfy economic wants.

Incentive

Any reward or benefit, such as money, advantage or good feeling, that motivates people to do something.

Income

Payments earned by households for selling or renting their productive resources. May include salaries, wages, interest and dividends.

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.

Property Rights

Legal protection for the boundaries and possession of property. Assigning of property rights to individuals, collectives or governments depends on the economic system.

Public Goods

Goods, often supplied by the government, for which use by one person does not reduce the quantity of the good available for others to use, and for which consumption cannot be limited to those who pay for the good.

Risk

The chance of losing money.

Saving

Disposable income (income after taxes) minus consumption spending.

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.

Specialization

A situation in which people produce a narrower range of goods and services than they consume. Specialization increases productivity; it also requires trade and increases interdependence.

Supply

The amount of a good or service that producers are willing and able to offer for sale at each possible price during a given period of time.

Tragedy of the Commons

Overuse or misuse of a commonly-owned resource, such as public grazing land or fishing waters.

Utility

An abstract measure of the satisfaction consumers derive from consuming goods and services.

Wants

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

Work

Effort applied to achieve a purpose or result, often for pay; skills and knowledge put to use to get something done; employment at a job or in a position; occupation, profession, business, trade, craft, etc.