Incentives Matter!

Something that motivates someone to do or not do something

• incentive

• cost

• opportunity cost

• benefit

What someone pays (money)

• opportunity cost

• marginal cost

• capital

• cost

The next best thing that a person gives up to do something else (the second choice)

• cost

• opportunity cost

• marginal cost

• benefit

Something good that someone receives when they do something

• opportunity cost

• marginal benefit

• benefit

• negative incentive

When the price of something goes up, consumers will demand less of that thing

• Law of Supply

• Law of Demand

• opportunity cost

• rationing device

When the price of something goes up, producers will supply more of that thing

• Law of Supply

• Law of Demand

• capital

• marginal benefit

This means "additional"

• opportunity cost

• marginal cost

• marginal benefit

• marginal

The added payment or lost opportunity of producing or consuming one more item

• marginal benefit

• marginal

• marginal cost

• cost

The added "goodness" of producing or consuming one more item

• benefit

• marginal cost

• marginal benefit

• cost

A way to determine who gets the available resources, goods and services

• capital

• cost

• Law of Demand

• rationing device