econ 1~6 Flashcards
resource
factor of production
scarcity
A shortage of an product
free goods
goods that are accessible with out producing
economic goods
goods that use resources to produce
types of factor of production
land, labor, enterprise, capital
labor
all human efforts
capital
man made product that helps to produce other products (machines)
capital goods / producer goods
goods that is wanted for what it produces
consumer goods
goods that consumers consume (food, clothings)
enterprise
a willingness to risk for a uncertain idea or a decision in a business
land
general resources from the earth
occupationally mobile
can be used for different preposes
geographically mobile
can be moved physically
gross investments
total output produced by capital goods
net investment
gross investment - depreciation
depreciation
capitals that wear out
opportunity cost
the best alternative forgone
PPC
production possibility curves
shift of ppc outwards
increase in qualities or quantities
market
arrangements that bring buyers into contract with sellers
microeconomics
study of decisions of firms and households + individual markets
macroeconomics
study of whole economy
economic agents
decision makers in economy
private sector
firms owned by shareholders & individuals
economic system
determines how resources are allocated
planned economic system
governments makes big decisions
directives
state instructions given to state owned enterprises
mixed economic system
where governments & private sectors play important roles
price mechanisim
how prices are determined to supply and demand
capital/labor intensives
large proportion used relative to each other
equilibrium
demand and supply are equal at current price
disequilibrium
when supply and demand do not equal each other
