Economics

Question 1

Relative Scarcity Definition

Answer 1

Definition= describes a situation where a resource is limited in supply, compared to demand.

Question 2

Resources Definitions and Examples

Answer 2

Definition= are the materials used in production of goods and services
Examples are metals ( capital) , electricity ( land), and skilled workers( labor).

Question 2

Want Definition and Examples

Answer 2

Definition=A want is a good or service that improves the quality of life.
Examples: technology, luxuries

Question 3

Need Definition and Examples

Answer 3

Definition= A need is a good or service that is deemed necessary for survival.
Examples: Food, water , shelter

Question 4

The Basic Economic Problem

Answer 4

The Basic economic problem is Relative Scarcity

Question 5

Opportunity Cost

Answer 5

Opportunity cost is the value of the next best option foregone when a choice is made

Question 6

The fundamental economic questions and how they are answered.

Answer 6

1) What to produce?
- demand
2) How to produce it?
- efficient process by producers
3) For whom to produce?
-price= determines whom goods or services will be produced for.

Question 7

Factors that lead to a change in supply and shift in the supply curve.

Answer 7

1) Availability of resources
2) Cost of production

Question 8

Law of Supply

Answer 8

-when there is an increase in price = is an increase in the quantity supplied
-when there is a decrease in price = decrease in quantity supplied

Question 9

Supply Definition

Answer 9

Definition= The ability and willingness of suppliers to supply a particular good or service.
*suppliers are motivated by profit

Question 10

Factors that lead to a change in demand and shift in the demand curve

Answer 10

1) change in level income
2) Fashion/Taste/Preference
3)Advertising/ Marketing

Question 11

Concept of the ‘Law of Demand’

Answer 11

-when there is an increase in price = decrease in quantity FOR DEMAND
-when there is a decrease in price = increase in quantity FOR DEMAND
these are the consumers

Question 12

Definition of Demand

Answer 12

The ability and willingness of consumers to purchase a particular good or service

Question 13

Unemployment rate.

Answer 13

when someone over 15 w/o work or less than an hour per week is actively looking for work
- this is considered to stay at 4-5%
- unemployment rate= (unemployment/ emp + unemp ) x100

Question 14

GDP definition

Answer 14

Gross Domestic Production is the final market value of all goods and services produced in an economy

Question 15

Microeconomics

Answer 15

The study of individual parts of the economy that interreact to make up the whole economy.

Question 16

Macroeconomics

Answer 16

The study of the economy as a whole. We explore Aus as a whole.
3 Main Goals
-full employment
- low inflation
- strong and sustainable

Question 17

Definition of Inflation

Answer 17

Inflation is a sustained increase in the general or average price level over time.