· Scarcity – A situation that arises when people have unlimited wants in the face of limited resources.
· Opportunity costs – In decision making, the value of the next-best alternative that could have been chosen.
· Marginal analysis – An approach to economic decision making based on considering the additional (marginal) benefits and costs of a small change in behaviour.
· Market economy – An economy in which market forces are allowed to guide the allocation of resources.
· Centrally planned economy – An economy in which decisions on resource allocations are guided by the state.
· Mixed economy – An economy in which resources are allocated partly through price signals and partly on…