economics topic test 1 micro Flashcards
social science
the study of society and relationships between people
positive statement
these are objective statements that are capable of being tested against the facts
normative statements
these express an opinion. They are subjective statements that carry value judgements.
economic activity
any activity that contributes to the economy
land
the raw materials available
labour
the workforce (the human capital)
capital
this is the man made equipment used in production of other goods and services
enterprise
these are individuals who make decisions and take risks
factors of production
CELL
resources
the factors of production
the fundamental economic problem
resources are limited and wants are unlimited
scarcity
resources are limited
opportunity cost
the next best alternative forgone
production possibility diagram/frontier/curve
indicates the maximum possible output that can be achieved given a fixed set of resources
resource allocation
the distribution of assets available for production
trade offs
where the selection of one choice results in the loss of another
unemployment of economic resources
a situation when assets available for production are not being used
economic growth
the annual percentage increase in real GDP
productive efficiency
any point of the PBB where you cannot produce more of one good without sacrificing the production of another good
