Chapter 1 - The basic Economic Problem

Question 1

Need

Answer 1

Good or services that are essential to one’s survival

Question 2

Wants

Answer 2

Something that is desired by one.

Question 3

Finite Resources

Answer 3

Non-Renewable resources

Question 4

Economic Problem

Answer 4

Unlimited wants and limited resources

Question 5

Scarcity

Answer 5

A lack of goods and services available to satisfy wants and needs

Question 6

What the Economic Problem leads to

Answer 6

Scarcity —> choices

Question 7

Economic Goods

Answer 7

Goods which are scare relative to the demand for them

Question 8

Free Goods

Answer 8

Resources that are available at 0 costs as there are more than enough available to satisfy the demand

Question 9

Factors Of Production

Answer 9

Land, labour, capital and enterprise

Question 10

Land

Answer 10

Includes all natural resources

Question 11

Labour

Answer 11

Includes all human resources

Question 12

Capital

Answer 12

Includes all man-made resources

Question 13

Enterprise

Answer 13

Brings all the other factors together to produce a good or service

Question 14

Mobility of factors of production

Answer 14

How easy or difficult it is for factors of production to be transferred to alternative industries.

Question 15

Factors Of Production

Answer 15

Land, labor, capital and enterprise

Question 16

Opportunity Cost

Answer 16

The next best alternative foregone, making and deciding on an economic decision

Question 17

Economic Choices

Answer 17

The choice made by consumers and producers due to scarcity of resources