1.1.3 Flashcards
1
Q
Basic economic problem?
A
Scarcity.
Wants are unlimited and sources are finite, resources have yo be used and distributed optimally
2
Q
Define opportunity cost
A
The value of the next best alternative foregone
3
Q
Factors of production
A
CELL
Capital
Entrepreneur ship
Land
Labour
4
Q
Capital
A
Physical: goods which can be used during the production process
Fixed: machines; buildings
Working: semi-finished or finished goods
5
Q
Entrepreneurship
A
Managerial ability
6
Q
Land
A
Natural resources such as coal, wheat soil
7
Q
Labour
A
Human capital, the human workforce
8
Q
Renewable resources
A
They can be replenished
Oxygen, fish, or solar power
9
Q
Non-renewable resources
A
Can’t be renewed
Fossil fuels such as xoal
Resource is us consumed faster than it is replenished
