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Economics > Basics > Flashcards

Basics Flashcards

1
Q

Define Economics

A

The study of how society satisfies their unlimited wants with limited resources

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2
Q

What is a need? Name four

A

Something needed for survival: food, clothing, shelter, water.

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3
Q

What is a want?

A

A desire that can be satisfied by consuming a good or service.

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4
Q

What is a good?

A

A physical product produced by a business

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5
Q

What is a service?

A

An activity performed to satisfy ones wants or needs.

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6
Q

What is a producer?

A

One who makes goods or provides services

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7
Q

What is a consumer?

A

One who purchases goods or services for personal use.

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8
Q

What is scarcity?

A

The result of an inability to satisfy unlimited wants with limited resources.

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9
Q

What is a trade-off?

A

A choice that involves giving up something to have more of another

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10
Q

What are incentives?

A

Reasons for increasing profit, interest, wages, and rent.

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11
Q

What is an opportunity cost?

A

The best alternative given up when making a choice

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12
Q

What is cost-benefit analysis?

A

An approach that weighs the benefits of an action against its cost.

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13
Q

What is the PACED decision model?

A 
A cost-benefit analysis method. Stands for:
define the Problem
list the Alternatives
determine the Criteria
Evaluate the alternatives
make the Decision
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14
Q

What are factors of production?

A

All of the resources that go into making a good or service.

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15
Q

What are the four factors of production?

A

Human/labor, capital, natural/land, and entreprenurial.

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16
Q

What are capital resources?

A

All resources made and used by people to produce and distribute goods and services. Ex: tools, machinery, offices, etc.

17
Q

Is money a capital resource

A

NO

18
Q

What are the three basic questions?

A 
1. The allocation question
   A. What will be produced?
   B. How much will be produced?
2. The production question
   A. How will it be produced?
3. The distribution question
   A. For who will it be produced
19
Q

What is a production possibility schedule?

A

A Chart listing all possibilities of production

20
Q

What is a production possibility curve?

A

A graph that shows the impact of scarcity on an economy.

21
Q

What is efficiency?

A

Efficiency is using resources in such a way as to maximize the production of goods and services

22
Q

What is underutilization?

A

Using fewer resources than an economy is capable of using.

Economics (5 decks)

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