general terms and definitions Flashcards
define economics
the study solving the problem of how to allocate SCARES RESOURCES that THAT HAVE alernative
so as to SATISFACTION of consumers NEEDS and WANTS
what econmics decisions are needed
WHAT to produce
WHAT resources are to be used
AND HOW they are produced
who is to get the goods
what is needs
things indivicals must have satisfied in order to sustain life
what happens if needs are not meet
long term- you will die
what are wants
desires individuals would like to have satisfied but are not necssary to sustain life
what is limited means-scarcity
the condition of limited resources relative to wants
what is opporunity cost
the next best alternative FOREGONE when a decision is made[ the second ranked alternative given up when choice is made]
what are our needs
food,water,shelter and cloths
what are luxury goods?
they are goods that we want to have but they are not essential to our needs
what are basic goods ?
they are goods that are essential for our needs
what are limited means?
time
money
skill
family
what are the difference between wants+needs?
needs are needed to sustain life but where as wants are not.
needs are limited where as wants are unlimited .
the payment for land
rent
the payment for labour
wages
the payment for capital
interest
