To economists, everything other than basic survival needs is considered a want.

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Whenever you make a spending decision, each available choice competes with every other available choice.

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The four factors of production include land, labor, capital, and entrepreneurship.

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Productivity is a measure of the amount of output (goods and services) produced per unit of input (productive resources) used.

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A pure traditional economy answers the three basic questions according to tradition, and things are done “the way they have always been done”.

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The opposite of a pure command economy is a pure market economy---also called capitalism, where economic decisions are not made by government, but by individuals.

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Capitalism as practiced in the United States today would be best defined as an economic system in which private individuals own the factors of production, but decide how to use them within legislated limits.

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Freedom of choice means that buyers, not sellers, make the decisions about what should be produced.

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