Scarcity: limited availability of things that we desire (not to be confused with shortage). Utility

SCARCITY: limited availability of things that we desire (not to be confused with shortage).

UTILITY: the benefits (satisfaction or well-being) individuals receive from owning or consuming goods and services.

RESOURCES: factors of production (inputs) that are used to produce the goods and services that give us utility.

ECONOMIZING PROBLEM: living in a world in which our material wants are unlimited while the means to produce goods that satisfy our wants are limited. Deciding how to use our scarce resources to satisfy some, but not all, of our wants.