Chapter 15~Intoduction To Economics Flashcards
Land?
All the natural resources available in a country that can be used to produce goods and services e.g. agricultural land, seas, rivers and lakes, mines and forests.
Labour?
All the people available in the country to help produce goods and services e.g teacher, doctor
Capital?
All the man-made things are available in the country to help produce goods and services e.g. machinery, vehicles, buildings, equipment
Enterprise?
The act of bringing land labour and capital together to set up a business to produce a product or supply a service as a profit e.g entrepreneur
Entrepreneur?
The person who shows enterprise and sets up his or her own business
Mixed economy?
A sharing approach to the production of goods and services in most areas. citizens are free to set up businesses to produce goods and services, provided they stay within the law. In some areas the government will control an area of business either by issuing licenses or they will operate the business themselves
Gross national product(GNP)?
The total quantity of goods and services produced in a country in any one year
Economic growth?
The change in GPN I.E.the total quantity of goods and services produced in a country from one year to the next
Inflation?
And increase in prices in a country from one period to the next
What is ‘land’ source of income?
Rent
What is ‘labour’ source of income?
Wages
What is ‘capital’ source of income?
Interest
What is ‘enterprise’ source of income?
Profit
3 types of economic system
- mixed economy e.g. Ireland
- free enterprise economy e.g. USA
- centrally planned economy e.g Cuba
3 benefits of economic growth
- New jobs created so employment falls
- People enjoy a higher standard of living
- More money available to the government to spend on health or education
Consumer price index (CPI)
- official measure of inflation in Ireland
- selection of everyday goods and services is chosen and their prices are compared on a regular basis in order to calculate the rate of inflation
2 causes of inflation
- increase in the cost of producing the goods e.g cost of wages
- demand for certain good is greater than the amount available
2 benefits of low inflation
- new jobs created so unemployment falls
* people have more money to spend so there is Economic’s growth
2 dangers of high inflation
- Irish jobs will be lost and unemployment will rise
* Irish good will become more expensive and be more difficult to sell them abroad
Economics?
The study of how people and businesses with limited income make decisions about what they spend their money on
