economics. Flashcards
economic problem.
having unlimited needs and wants, but limited resources to satisfy them.
scarcity.
the economic problem of having unlimited needs and wants, but limited resources to satisfy them.
opportunity cost.
the next best alternative given up whenever a choice is made.
factors of production.
capital, enterprise, land, and labour.
interdependence.
the mutual dependence between partners in an economy; that is, the reliance of consumers, workers, businesses, and governments on each other.
the 3 economic questions.
- what to produce
- how to produce, and
- who to produce it for.
subsistence economy.
an economy directed in subsistence concerning the provision of food, clothing, and shelter, rather than to a market.
planned economy.
a type of economic system where investment, production, and the allocation of capital goods takes place according to economy-wide economic plans and production plans.
market economy.
a system in which production of goods and services is determined by supply and demand.
mixed economy.
an economic system that combines elements of a market economy and planned economy that accepts private property, freedom, self-interest, competition, and minimum government intervention.
gdp.
stands for gross domestic product, is the value for all goods and services produced within a country in a given period, usually discussed in terms of gdp per capita (total gdp divided by the total population of the country).
recession.
a technical term referring to two consecutive quarters of negative growth in an economy.
cyclical unemployment.
overall unemployment resulting directly from the business cycle’s downturn.
structural unemployment.
overall unemployment from when the economy is getting out of lower points of the business cycle, when innovation replaces employment, and is referred to as long-term unemployment.
frictional unemployment
is the result of workers searching for new employment or transitioning from their old jobs to new ones.
