Universal Economic Problem (UEP)

The problem of how to use scarce resources to satisfy unlimited wants and needs.

1. What goods and services are to be produced and in what quantities? 2. How are those goods and services to be produced? 3. Who will receive and consume those goods and services?

An economy based on supply and demand with little or no government control.

An economy where the government decides what goods to produce, as well as the price and quantity of production.

An economy focused on essentials like food, clothing, and shelter, often found in developing or underdeveloped countries.

A graphical representation showing different combinations of two goods that can be produced with full employment of resources.

Productive efficiency is achieved if the economy is producing ON the PPC.

Enterprise or entrepreneurial ability is the ability to initiate the production process by organizing and combining all necessary factors of production.

Implicit cost is any cost that has already occurred but not necessarily shown or reported as a separate expense.

Economies can push their curve out through innovation, productivity improvements, and immigration.

The cost-benefit principle states that one should choose to do something only if the extra benefit of doing it is greater than the extra cost.

Multi-factor Productivity (MFP) is defined as output per unit of combined inputs.