Chapter 15~Intoduction To Economics

Question 1

Land?

Answer 1

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.

Question 2

Labour?

Answer 2

All the people available in the country to help produce goods and services e.g teacher, doctor

Question 3

Capital?

Answer 3

All the man-made things are available in the country to help produce goods and services e.g. machinery, vehicles, buildings, equipment

Question 4

Enterprise?

Answer 4

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

Question 5

Entrepreneur?

Answer 5

The person who shows enterprise and sets up his or her own business

Question 6

Mixed economy?

Answer 6

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

Question 7

Gross national product(GNP)?

Answer 7

The total quantity of goods and services produced in a country in any one year

Question 8

Economic growth?

Answer 8

The change in GPN I.E.the total quantity of goods and services produced in a country from one year to the next

Question 9

Inflation?

Answer 9

And increase in prices in a country from one period to the next

Question 10

What is ‘land’ source of income?

Answer 10

Rent

Question 11

What is ‘labour’ source of income?

Answer 11

Wages

Question 12

What is ‘capital’ source of income?

Answer 12

Interest

Question 13

What is ‘enterprise’ source of income?

Answer 13

Profit

Question 14

3 types of economic system

Answer 14

1. mixed economy e.g. Ireland
2. free enterprise economy e.g. USA
3. centrally planned economy e.g Cuba

Question 15

3 benefits of economic growth

Answer 15

1. New jobs created so employment falls
2. People enjoy a higher standard of living
3. More money available to the government to spend on health or education

Question 16

Consumer price index (CPI)

Answer 16

• 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

Question 17

2 causes of inflation

Answer 17

• increase in the cost of producing the goods e.g cost of wages
• demand for certain good is greater than the amount available

Question 18

2 benefits of low inflation

Answer 18

• new jobs created so unemployment falls

* people have more money to spend so there is Economic’s growth

Question 19

2 dangers of high inflation

Answer 19

• Irish jobs will be lost and unemployment will rise

* Irish good will become more expensive and be more difficult to sell them abroad

Question 20

Economics?

Answer 20

The study of how people and businesses with limited income make decisions about what they spend their money on