Basic economics vocabulary quiz

The use of limited resources to meet societies unlimited wants and needs.

• Opportunity Cost

• Trade-off

• Shortage

• Scarcity

Alternatives we give up when we choose one course of action over another.

• choice

• Trade-offs

• opportunity cost

• cost / benefit analysis

When a country may choose to produce capital or consumer goods. Capital goods, goods used to make other goods. Consumer goods, finished goods that people typically buy. Sometimes seen in a production possibilities curve.

• opportunity cost

• cost/benefit analysis

• tradeoff

• Guns and Butter

The most desirable alternative given up as a result of making a decision

• marginal cost

• opportunity cost

• Trade-offs

• thinking at the margin

The process of deciding whether to do or use one additional unit of a resource.

• marginal benefit

• Waivering

• thinking at the margin

• marginal cost

The additional benefit of adding one more unit (resource)

• thinking at the margin

• marginal benefit

• marginal cost

• opportunity cost

The additional cost of adding one more unit.

• marginal cost

• opportunity cost

• thinking at the margin

• Trade-off

A decision making process in which you compare what you will sacrifice and gain by a specific action.

Group of answer choices

• opportunity cost

• marginal benefit

• marginal cost

• cost / benefit analysis

A graph illustrating the maximum combinations of goods and services that can be produced at a given time with fixed resources.

• production possibilities curve

• Tradeoff

• Guns and Butter

• Circular Flow model

Unattainable but desirable point on a production possibilities frontier graph

• unemployment

• Point inside the curve

• Point outside the curve

• Point on the curve