The study of how people choose to allocate their scarce resources in order to produce, exchange, and consume the goods and services to satisfy their wants. Resource Inputs used to produce goods and services. There can only be a certain amount of goods and services because the resources used to make them are scarce. Capital man-made creations used to make goods and services. Physical capital is roads, bridges, machinery, tools, etc.
Human capital is the knowledge and skill that the worker possesses.
Entrepreneurial Ability the talent needed to think up new methods or products to make a good or service better. Goods are things that we can see, feel, touch, etc. They are tangible. They are hot dogs, paper towels, cars, CD s, etc. Services are intangible.