Economics

Question 1

The basic economic problem

What is the definition of scarcity?

Answer 1

A lack of resources available to produce all of the goods and services available to satisfy unlimited wants.

Question 2

The basic economic problem

What is the definition of finite resources?

Answer 2

Non renewable resources that will eventually run out.
e.g. Machines (metal), water, plastic, electricity

Question 3

The basic economic problem

What is the definition of renewable resources?

Answer 3

Resources that can be replaced as they are used to produce goods and sevices.
e.g. Paper, workers (labour), cardboard,

Question 4

The basic economic problem

There are limited resources and unlimited wants which leads to the problem of _____ and so _____ have to be made.

Answer 4

There are limited resources and unlimited wants which leads to the problem of scarcity and so choices have to be made.

Question 5

The basic economic problem

How do consumers decide how to spend their money?

Answer 5

e.g. Buy a new car or go on a holiday

Question 6

The basic economic problem

How do businesses decide how to benefit their business?

Answer 6

e.g. Invest in new machinery ot spend money training workers

Question 7

The basic economic problem

How do workers decide how to spend their free time?

Answer 7

e.g. Work extra hours to earn money or go home on time to spend timw with family

Question 8

The basic economic problem

How do governments decide how to benifit their country?

Answer 8

e.g. Build a school or a hospital

Question 9

The basic economic problem

What are the Factors of Production?

Answer 9

Capital, enterprise, labour and land

Question 10

The basic economic problem

What are the FoP used for?

Answer 10

The resources that are used to produce goods and services.

Question 11

The basic economic problem

What is capital?

Answer 11

Anything that is man-made as well as the money invested into the business.

Question 12

The basic economic problem

What is enterprise?

Answer 12

The owner of the business that have taken the risk of setting it up.

Question 13

The basic economic problem

What is labour?

Answer 13

The physical and/or mental effort of workers.

Question 14

The basic economic problem

What is land?

Answer 14

The natural resources taken from the land and used by a business.
OR
The land inself.

Question 15

The basic economic problem

What is the payment for capital?
A. Wages
B. Interest on loans
C. Profit
D. Rent

Answer 15

B

Question 16

The basic economic problem

What is the payment for enterprise?
A. Wages
B. Interest on loans
C. Profit
D. Rent

Answer 16

C

Question 17

The basic economic problem

What is the payment for labour?
A. Wages
B. Interest on loans
C. Profit
D. Rent

Answer 17

A

Question 18

The basic economic problem

What is the payment for land?
A. Wages
B. Interest on loans
C. Profit
D. Rent

Answer 18

D

Question 19

The basic economic problem

What is the definition of mobility of FoP?

Answer 19

How easy or difficult it is for FoP to be transferred to different industries.

Question 20

The basic economic problem

What is the definition of occupational mobility?

Answer 20

Is when a recource is able to change task, e.g. lawyer to judge.

Question 21

The basic economic problem

What is the definition of geographical mobility?

Answer 21

Is when the resource changes its location, continuing to fulfill its same function as before.

Question 22

The basic economic problem

How do you increase the quantity and quality of capital?

Answer 22

Quantity:
Business buy more machinery
Quality:
Improvements in technology

Question 23

The basic economic problem

How do you increase the quantity and quality of enterprise?

Answer 23

Experience of managing business or education.

Question 24

The basic economic problem

How do you increase the quantity and quality of labour?

Answer 24

Quantity:
1. Increase population
2. Increase immigration
Quality:
Education and training

Question 25

# The basic economic problem How do you increase the quantity and quality of land?

Answer 25

Quantity: 1. Reclaming land from the sea 2. Discovery of more oil Quality: The use of fertilisers

Question 26

# The basic economic problem What is the definition of opportunity cost?

Answer 26

The next best alternative or highest value alternative foregone (given up) when making a choice.

Question 27

# The basic economic problem What does a production possibility curve show?

Answer 27

Shows the maximum possible output for two goods or cervices with a given amount of resources.

Question 28

# The basic economic problem What is the definition of revenue?

Answer 28

Income from the sale of goods and services.

Question 29

# The basic economic problem What does an increase in production possibilities in a PPC look like?

Answer 29

Curve from top left to bottom right, the PPC shifting to the right.

Question 30

# The basic economic problem What does it mean when there is an increase in production possibilities? | PPC

Answer 30

This country can produce more of both goods than before.

Question 31

# The basic economic problem What does a decrease in production possibilities in a PPC look like?

Answer 31

Curve from top left to bottom right, the PPC shifts to the left.

Question 32

# The basic economic problem What does it mean when there is a decrease in production possibilities? | PPC

Answer 32

This country can produce less of both goods than before.

Question 33

# The allocation of resources What is the definition of microeconomics?

Answer 33

The study of individual and busniess economic behavior.

Question 34

# The allocation of resources What is the definition of macroeconomics?

Answer 34

The study of the whole economy.

Question 35

# The allocation of resources What are the differences of micro and macroeconomics?

Answer 35

Microeconomics: Consumer, producer, supply, demand, and price Macroeconomics: National income, inflation, GDP, unemployment

Question 36

# The allocation of resources List at least 2 choices that are microeconomics.

Answer 36

1. Bad weather impacts the rice harvest 2. An increase in your parents' wages 3. The invention of a new machine to clean floors quickly 4. An increase in the price of cocoa

Question 37

# The allocation of resources List at least 2 choices that are macroeconomics.

Answer 37

1. Unemployment increasing 2. The government raising income tax 3. Rising wages for all workers across the country

Question 38

# The allocation of resources Who are the private sector?

Answer 38

Individuals and businesses

Question 39

# The allocation of resources Who is the public sector?

Answer 39

Government.

Question 40

# The allocation of resources What is the definition of free market economy?

Answer 40

All decisions are taken by the private sector in a free market economy. There is little or no government intervention.

Question 41

# The allocation of resources What is the definition of mixed economy?

Answer 41

All decisions about recource allocation are taken together by the government and the private sector. The government provides goods and services, such as public utilities, safety, and military.

Question 42

# The allocation of resources What is the definition of planned economy?

Answer 42

All decisions about resources allocation, price and how goods and services will be produced and allocated are taken by the public sector.

Question 43

# The allocation of resources Name at least a country for being in the free market economy, mixed economy, and planned economy

Answer 43

Free market economy: Hong Kong, USA, etc. Mixed economy: France, India, etc. Planned economy: Russia, North Korea, etc.

Question 44

# The allocation of resources What is the definition of demand?

Answer 44

The quantity of a good or service that consumers are **willing and able** to buy at a given price in a particular time period.

Question 45

# The allocation of resources What is the law of demand?

Answer 45

As price increase, quantity demand decreases. As price decreases, quantity demand increases.

Question 46

# The allocation of resources What is the definition of individual demand?

Answer 46

The amount of a product an individual would be willing and able to buy, at different prices.

Question 47

# The allocation of resources What is the definition of market demand?

Answer 47

The total demand for a product at different prices. It is found by adding up each individual's demand at different prices.