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Consumer Economics

Unit 1 Vocabulary

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Unit 1 Notes


Economics                     The study of people producing and exchanging to get goods and services they want


Economy                       The system that results from choices we make as consumers, workers, business owners, and government officials


Voluntary Exchange          Getting what you want in exchange for something they want


Market                          Arrangement where exchanges are allowed to happen


Scarcity                         Central economic problem facing all countries.  The inability to satisfy all wants due to lack of resources


Opportunity Cost:          The best alternative given up when making a choice.


Marginal Cost              Extra costs of the choice made


Marginal Benefits            Extra benefits of the choice made


Productive Resources          Capital, Human, and Natural














Law of increasing opportunity cost:  Obtaining more of a good in equal   amounts requires giving up even larger amounts of the alternative good.

 are increased or technology allows for their




Inside frontier: unemployed resources or resources used inefficiently


Expanding frontier: occurs when resources

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