Concepts Flashcards
What is Scarcity
The economic Problem of having unlimited needs and wants but limited resources available.
SCARCITY: what are resources
man made or natural materials or services used in the production of goods and services production. (for example skilled wokers, soil, water, electricty)
SCARCITY: what are four categories of resources with examples
Land (natural Resources such as coal or water)
Labour (Human resources such as workers)
Capital (Manufactured resources such as equipment)
Entrepreneurship (management resources, skills that bring resources together)
what is interdependence
how we rely on others to satisfy out needs and wants.
Participants of the economy rely on each other to produce/consumer g+s
what is “Allocation and Market”
the way we distribute our scarce resources among producers and consumers
Allocation and Market: how do markets and costs/prices play a role
markets - way of distributing g+s
cost/price - determine how much is bought/produced/distribute
what is “making choices”
how we decide/priortise what we produce/consumer with limited resources available
MAKING CHOICES: Explain how consumers make choices and the 4 categories of choices
Consumers decide what is needed to staisy needs/wants
Financial Descisions: how much save or spend
Business Choices: what to produce, where to sell
Employment Choices; what career path to follow
Legal Choice: whether to take legal action over bad products
What is Economic Performance
measuring the economy to know the strengths+weakness so we can improve econ performance and living standards
ECONOMIC PERFORMANCE/LIVING STANDARD: what are the key indicators
Gross Domestic Product (total value of all g+s produced in country per year) Inflation( general increases in price of g+s) Unemployment Rate ( % of people who are unemployed out of all people who are eligible to work)
What is specialization and Trade
focusing on producing a g+s to become more efficient competitive.
SPECIALIZATION AND TRADE: why is it important
Countries alone do not have enough resources to produce everything for the population so the country imports products in.
Specialization allows a country to take advantage of economy sales and therefore can mass produce products
WHat are living standards
what it is like to live in a country in terms of material and non material wellbeing of citizens
what are material living standards
our access to physical goods and services for example car, house, food.
Measured by quantity of g+s available each year GDP
what are non material living standards
non tangible things that increases living standards for example freedoms, lesiure time
Not measured in $ terms but in overall wellbeing.
