4.1.1.2 Nature And Purpose Of Economic Activity Flashcards
What is the central purpose of economic activity?
The production of goods and services to satify people needs and want
What is a need?
A need is something that necessarily for human survival. Something that people cant live without . Something that people have to have.
Give examples of a need products
Food, shelter,clothing and water
What is a want?
A want is something that people would like to have but it is not an essential for survival.
Give examples of want products?
Phones and fashionable clothing.
Economic welfare
The economic well-being of an individual, a group within society or an economy.
Why is it difficult to assess economic welfare ?
happiness is a value judgement , it is impossible to get an objective assessment of Economic welfare. People have different tastes and prefrences
What is an economic system?
The set of institutions within which a community decides what, how and for whom to produce.
What are the key economic decisions ?
what to produce, how to produce and who is to benefit from the goods and services produced.
