Glossary Terms:

The Price of Gasoline: What's Behind It?

Glossary terms from:


People who use goods and services to satisfy their personal needs and not for resale or in the production of other goods and services.


An amount that must be paid or spent to buy or obtain something. The effort, loss or sacrifice necessary to achieve or obtain something.


The quantity of a good or service that buyers are willing and able to buy at all possible prices during a period of time.


The study of how people, firms and societies choose to allocate scarce resources with alternative uses.


Economic units that demand productive resources from households and supply goods and services to households and government agencies.

Market Economy

An economy that relies on a system of interdependent market prices to allocate goods, services, and productive resources and to coordinate the diverse plans of consumers and producers, all of them pursuing their own self-interest.


Anything that is generally accepted as final payment for goods and services; serves as a medium of exchange, a store of value and a standard of value. Characteristics of money are portability, stability in value, uniformity, durability and acceptance.


The amount of money that people pay when they buy a good or service; the amount they receive when they sell a good or service.


A good or service that can be used to satisfy a want.


A process of manufacturing, growing, designing, or otherwise using productive resources to create goods or services used to to satisfy a want.


Income received for entrepreneurial skills and risk taking, calculated by subtracting all of a firm's explicit and implicit costs from its total revenues.


In a credit arrangement, the total amount spent during the billing cycle.


The basic kinds of resources used to produce goods and services: land or natural resources, human resources (including labor and entrepreneurship), and capital.


An exchange of goods or services for money.


Use money now to buy goods and services.


Compulsory payments to governments by households and businesses.


Desires that can be satisfied by consuming or using a good or service. Economists do not differentiate between wants and needs.


Effort applied to achieve a purpose or result, often for pay; skills and knowledge put to use to get something done; employment at a job or in a position; occupation, profession, business, trade, craft, etc.