Economic Choices Flashcards
Needs
What we need to survive
food, water,shelter, clothing
Wants
Things that are not needed for everyday survival but would be nice to have.
Limited means
We have unlimited wants but only limited means.
Our means include money, to buy things, but also the resources needed to produce goods and services.
Time- Time is a limited resources because there are only so many hours in the day.
Skills- Everyone if born with different abilities and potentials.
Income
Individuals or households earn income either by selling resources to firm or as a result of ownership.
Goods
Goods are tangible – we can touch or see, has physical presence.
Opportunity cost
Because we have unlimited wants but limited means we have to make choices about what we consume.
When we buy one good we have to forgo another good we would also have liked to buy.
First preference is the one want to do second best is the you foregone ( gave up ) to do the first one.
Services
Services are intangible- an act performed by someone for us.
Values
Qualities, characteristics, or ideas about which we feel strongly.
Our values affect our decisions, goals and behavior.
Natural resources examples
water land soil plants animals
Human resources
labour
Capital resources
These are man made goods use to produce other goods and services.
machinery, tools, factories,
Renewable resources
Can be replenished and they will never finish E.g. trees sheep grass as they can be grown again and again
Non-Renewable Resources
Non-renewable resources are limited and will run out someday. E.g. oil gas coal.
