AP Vocab

cost[[endash]]benefit analysis (CBA) Estimates and comparison of short-term and long-term benefits (gains) and costs (losses) from an economic decision. discount rate The economic value a resource will have in the future compared with its present value. economic system Method that a group of people uses to choose what goods and services to produce, how to produce them, how much to produce, and how to distribute them to people. See pure free-market economic system.
External cost Social benefits ("goods") and social costs ("bads") not included in the market price of an economic good. See external benefit, external cost. Compare full cost, internal cost. full cost Cost of a good when its internal costs and its estimated short- and long-term external costs are included in its market price. Compare external cost, internal cost.
GDP See gross domestic product. high-throughput economy The situation in most advanced industrialized countries, in which ever-increasing economic growth is sustained by maximizing the rate at which matter and energy resources are used, with little emphasis on pollution prevention, recycling, reuse, reduction of unnecessary waste, and other forms of resource conservation. Compare low-throughput economy, matter-recycling economy. high-waste economy See high-throughput economy. human capital See human resources. human resources Physical and mental talents of people used to produce, distribute, and sell an economic good. Compare manufactured resources, natural resources. internal cost Direct cost paid by the producer and the buyer of an economic good. Compare external benefit, external cost, full cost. manufactured capital See manufactured resources. manufactured resources Manufactured items made from natural resources and used to produce and distribute economic goods and services bought by consumers. These include tools, machinery, equipment, factory buildings, and transportation and distribution facilities. Compare human resources,