economics Flashcards
What is Economics?
The science of choice regarding the allocation of scarce resources
Economics is concerned with making efficient use of limited resources to maximize output and satisfy the greatest number of wants.
Define Scarcity in Economics.
The gap between limited resources and theoretically limitless wants
Scarcity necessitates careful choices in resource allocation.
What is Opportunity Cost?
The value of the alternative forgone by choosing a particular activity
Every decision in a world of scarcity involves an opportunity cost.
What are the main concepts Economics focuses on?
- Choice
- Scarcity
- Opportunity Cost
What is Construction Economics?
A specialism of economics concerned with the construction industry and its unique characteristics
It has evolved due to the size of the construction industry and its contribution to national standards of living.
List the distinct characteristics of the Construction Industry.
- The Product
- The People
- The Economy
- Pricing
- Uniqueness
Describe the Product characteristic of the Construction Industry.
The physical nature of the product is large, heavy, and expensive
Who dominates the Construction Industry?
A large number of relatively small firms spread over a large geographical area
How is demand for construction activity determined?
By the state of the economy
What makes pricing in the construction industry complex?
The tendering process used at various stages throughout the process
Why are most construction projects considered unique?
They usually have some defining quality that makes them one-off
What does Microeconomics study?
The behavior of individuals and firms in making decisions regarding the allocation of scarce resources
What is the focus of Macroeconomics?
The sum total of economic activity, including growth, inflation, and unemployment
Define Business Cycles.
Fluctuations in economic activity characterized by expansion and contraction
What are the two phases of a business cycle?
- Expansion
- Contraction
How are construction markets characterized?
Less structured, more informal, and generally determined by geographic area
What impacts the level of competition in construction markets?
The complexity of the construction
What is the significance of project complexity in construction?
Highly complex projects attract competing firms from a larger geographical area
How do small firms operate in the construction industry?
They often subcontract for work in their local markets
What is the GDP?
The total monetary or market value of all finished goods and services produced within a country’s borders in a specific time period
What percentage of GDP did the construction industry represent as of March 2019?
7%
How is the Canadian economy described in terms of size?
10th largest GDP by nominal and 16th largest by PPP in the world
What is the primary sector dominating the Canadian economy?
The service industry
What was the estimated value of Canada’s natural resources in 2016?
US$33.2 trillion
What is significant about the TSX?
It is the ninth-largest stock exchange in the world by market capitalization
What does the real estate sector in Canada represent?
Growing at nearly twice the pace of GDP
Fill in the blank: Economics is the study of _______.
[choice, scarcity, and opportunity cost]
