Economic Problem

Question 1

Economic Problem

Answer 1

• Scarcity

- limited resources for our unlimited wants

Question 2

Opportunity Cost

Answer 2

The cost of trading one good over another

Question 3

factors influencing individuals spending/saving

Answer 3

• high income earners have a greater ability to save and spend a lower proportion of income

Question 4

factors influencing individuals work

Answer 4

greater skill required the higher the income, which leads to improved living standards

Question 5

factors influencing individuals retirement

Answer 5

must put 9.5% of income into super

Question 6

factors influencing business price

Answer 6

goal is to make profit, so will set prices based on how much profit they can make

Question 7

factors influencing individuals decision making

Answer 7

spending/saving/work/education/retirement/voting

Question 8

factors influencing business decision making

Answer 8

pricing, production, resource use, industrial relations

Question 9

factors influencing business production

Answer 9

labour or capital, which will be most efficient?

Question 10

factors influencing business industrial relations

Answer 10

important to contain labour costs to maximise productivity and profit

Question 11

natural resources

Answer 11

naturally occurring elements or environmental resources which may be utilised for production

Question 12

capital

Answer 12

goods that are used to produce more goods and services in the future. e.g. machinery

Question 13

labour

Answer 13

productive efforts of workers to make g/s

Question 14

entrepreneurship

Answer 14

recognises profit opportunity, is able to organise the resources and is willing to accept risk