Chapter 1, Section 1 Scarcity and the Science of Economics verified questions and solution A+
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Scarcity - -- the condition that results from society not having enough resources to
produce all the things people would like to have
- fundamental economic problem facing all societies resulting from a combination of scarce
resources and people's virtually unlimited needs and wants
Economics - -- the study of how people try to satisfy seemingly unlimited and competing
needs and wants through the careful use of relatively scarce resources
Need - -- a basic requirement for survival, such as food, clothing, and shelter
Want - -- something we would like to have but it not necessary for survival
How are our needs and wants usually expressed? - -in terms of economic products
What 2 groups do these products generally fall into? - -1.) a good
2.) a service
Good - -- a useful, tangible item, such as a book, car, or MP3 player, that can be used to
satisfy a need or want
- tangible economic product that is useful, transferable to others, and used to satisfy wants and
needs
What are goods then divided into? - -separate categories
, What are the categories of a good? - -- durable good
- nondurable good
- consumer good
- capital good
Durable Good - -- one that lasts 3 years or more when used on a regular basis
- include tools such as robot welders and tractors, and consumer goods such as automobiles
Nondurable Good - -- an item that lasts for fewer than three years when used on a
regular basis
- food, writing paper, and most clothing items
Consumer Good - -- a good intended for final use by individuals, such as shoes, a shirt, or
an automobile
Capital Good - -- a tool or good such as machinery or equipment that is used by
businesses to produce other products
Service - -- work that is performed for someone
- includes haircuts, home repairs, and forms of entertainment such as concerts
What do most goods and services have? - -value
Value - -- a term that refers to a worth that can be expressed in dollars and cents
Paradox of Value - -- created by Scottish social philosopher Adam Smith in 1776
grade
Scarcity - -- the condition that results from society not having enough resources to
produce all the things people would like to have
- fundamental economic problem facing all societies resulting from a combination of scarce
resources and people's virtually unlimited needs and wants
Economics - -- the study of how people try to satisfy seemingly unlimited and competing
needs and wants through the careful use of relatively scarce resources
Need - -- a basic requirement for survival, such as food, clothing, and shelter
Want - -- something we would like to have but it not necessary for survival
How are our needs and wants usually expressed? - -in terms of economic products
What 2 groups do these products generally fall into? - -1.) a good
2.) a service
Good - -- a useful, tangible item, such as a book, car, or MP3 player, that can be used to
satisfy a need or want
- tangible economic product that is useful, transferable to others, and used to satisfy wants and
needs
What are goods then divided into? - -separate categories
, What are the categories of a good? - -- durable good
- nondurable good
- consumer good
- capital good
Durable Good - -- one that lasts 3 years or more when used on a regular basis
- include tools such as robot welders and tractors, and consumer goods such as automobiles
Nondurable Good - -- an item that lasts for fewer than three years when used on a
regular basis
- food, writing paper, and most clothing items
Consumer Good - -- a good intended for final use by individuals, such as shoes, a shirt, or
an automobile
Capital Good - -- a tool or good such as machinery or equipment that is used by
businesses to produce other products
Service - -- work that is performed for someone
- includes haircuts, home repairs, and forms of entertainment such as concerts
What do most goods and services have? - -value
Value - -- a term that refers to a worth that can be expressed in dollars and cents
Paradox of Value - -- created by Scottish social philosopher Adam Smith in 1776
