Unit One: Basic Economic Concepts

Unit Terms:

Absolute Advantage

Comparative Advantage

Capital

Economics

Efficiency

Labor

Land

Law of Increasing Costs

Macroeconomics

Microeconomics

Normative Economics

Opportunity Cost

Positive Economics

Production Possibilities Frontier

Resource

Terms of Trade

Unit Questions:
1. Explain the importance of choice in economics.
2. Compare and contrast market economies and command economies.   Which economic system do you think works better, and why?
3. Explain the concepts of marginal benefit and marginal cost
4. Explain the difference between microeconomics and macroeconomics.  List three examples for each.
5. What is the difference between positive and normative economics?