It includes the “gift of nature” or the natural resources used in the production of

goods and services. {=Land}

This principle tells us that "everyone does best when each person (or each country)
concentrates on the activities for which his or her opportunity cost is lowest."
{=The principle of comparative advantage =principle of comparative advantage}

It is the condition of having to choose among alternatives. {=scarcity}

It is the study of the economy as a whole. {=macroeconomics}

It takes into consideration the opportunity costs involved when choosing to

manufacture multiple types of goods with limited resources. {=comparative
advantage}

It refers to additional cost to you over and above the costs you have already
incurred. {=marginal cost}

These are costs associated with a decision that often aren’t included in normal
accounting costs. {=implicit costs =implicit}

This is the benefit that you might have gained from choosing the next-best
alternative. {=opportunity cost =opportunity costs}

It describes a scenario in which one entity can manufacture a product at a higher

quality and a faster rate for a greater profit than another competing business or
country can accomplish. {=absolute advantage}

These costs that show up in financial accounts but that economists argue should not
be considered in a choice because they are already spent. {=illusionary sunk costs
=illusionary sunk costs =illusionary sunk cost =sunk costs =sunk cost}

Macroeconomics focuses on aggregate relationships such as how household consumption

is related to income and how government policies can affect growth. {T}

According to the economic decision rule, if the marginal benefits of doing

something exceed the marginal costs, don't do it. {F}

Labor refers to the process of combining labor, land and capital to produce goods
and services. {F}

When performing a cost-benefit analysis of an action, it is important to account

for all relevant costs, including the implicit value of alternatives that must be
forgone in order to carry out the action. {T}

The Scarcity Principle in the previous lesson reminds us that the opportunity cost
of spending more time on any one activity is having more time available to spend on
others. {F}

Factor endowments is one of the sources of comparative advantage. {T}

One advantage of producing on a large scale is that costs become lower as more is
produced. {T}

Absolute advantage looks at the effectiveness of producing a single product. {F}

The opportunity cost of a given option is equal to the forfeited benefits that
could have been achieved by choosing an available alternative in comparison. {T}
The Cost-Benefit Principle tells us that the level of an activity should be
increased if, and only if, its marginal benefit exceeds its marginal cost.{T}