Economics Flashcards
What is scarcity?
The limited supply of a resource
What is an economic system?
A system for allocating scarce resources
What is the ‘basic’ problem of Economics
Choices must be made about how to allocate scarce resources efficiently/ scarcity necessitates choices
What is economics?
The study of how scarce resources are allocated between society’s competing needs and wants
What is the Economic Problem
The problem is how to make the choice of allocating resources in such a way that can address the unlimited wants of the consumers with the scarce resources supplied to the market
What is the price theory
The initial price determines the future of the product / if demand for a product increases but the supply stays the same, the price will also increase
What are needs
Items needed in order to survive (food, water, recreation, shelter, clothing)
What are wants
Items people would like to have
What are durable goods
Goods that can be used more than once and last a relatively long time
What are nondurable goods
Goods that have a limited lifespan or can be used once
