Goods and Services

Question 1

What are free goods?

Answer 1

Goods and services that are abundant - their supply is not limited.

Question 2

What is the market price of a free good?

Answer 2

Usually zero

Question 3

Is fresh air a free good?

Answer 3

Usually. But in some circumstances, it is scarce. E.g. a mine shaft or a polluted city.

Question 4

What is an economic good?

Answer 4

A good that is not free. I.e. it is scarce

Question 5

What do we call any good that a consumer pays for?

Answer 5

An economic good

Question 6

What is the main influence on the price of a good?

Answer 6

How scarce it is. E.g. diamonds are less useful than air, but are more expensive.

Question 7

What are resources?

Answer 7

Things we use to satisfy our needs and wants by producing goods and services

Question 8

What are the three kinds of resources?

Answer 8

Natural resources - things that occur in nature
Human resources - people’s skill and labour
Human-made resources - tools, machines, motor vehicles, money

Question 9

What is the most common limited resource?

Answer 9

Money

Question 10

Give some examples of non-renewable resources

Answer 10

Oil, coal, natural gas

Question 11

What is produced in the primary sector?

Answer 11

Raw materials

Question 12

List some examples of activities in the primary sector.

Answer 12

farming, fishing, forestry, mining

Question 13

Where are primary sector activities conducted?

Answer 13

Rural areas

Question 14

What is the first layer of the economy?

Answer 14

The Primary Sector

Question 15

What is the second layer of the economy?

Answer 15

The Secondary Sector

Question 16

What is produced in the secondary sector?

Answer 16

Goods that people can use.

Question 17

What does the secondary sector consume to produce goods?

Answer 17

Raw materials and labour

Question 18

Give some examples of secondary sector businesses.

Answer 18

ship building yards, aeroplane construction plants, car factories, building, engineering

Question 19

What is the third layer of the economy?

Answer 19

The Tertiary Sector

Question 20

What is produced in the tertiary sector?

Answer 20

Services

Offer of secondary goods to the general public (i.e. retail services)

Question 21

Give examples of tertiary sector goods and services.

Answer 21

Education - schools and universities
Health Care - hospitals
Money management - banks and insurance companies
Legal services - law firms, courts

Question 22

What is the difference between goods and services?

Answer 22

Goods are items you can see and touch. Services are what people do to help you.

Question 23

In poor countries, which sector dominates production?

Answer 23

The Primary Sector

Question 24

Sum up the three economic sectors.

Answer 24

Primary-sector businesses use natural resources directly.
Secondary-sector businesses use raw materials to manufacture goods.
Tertiary-sector businesses provide services

Question 25

In rich countries, which sector dominates production?

Answer 25

The Tertiary Sector

Question 26

How do businesses decide what goods and services to produce?

Answer 26

They study people's wants and needs, and produce goods and services to satisfy them.

Question 27

What do we call goods that directly satisfy consumers' wants and needs?

Answer 27

Consumer goods

Question 28

What do we call goods that last for a long time?

Answer 28

Durable goods

Question 29

What do we call goods that are consumed quickly?

Answer 29

Non-durable goods

Question 30

What do we call goods that are used to produce other goods - e.g. machinery?

Answer 30

Capital goods

Question 31

What do we call secondary goods (i.e. not raw materials) that are used to manufacture other goods?

Answer 31

Semi-finished goods

Question 32

Give an example of a semi-finished good.

Answer 32

Steel = iron + carbon + some other raw materials

Question 33

What do we call services that are aimed at the final consumer?

Answer 33

Personal services

Question 34

What do we call activities that get goods and services to the final consumer?

Answer 34

Commercial services

Question 35

Define a household.

Answer 35

A household is a group of people who live in the same residence and purchase goods and services.

Question 36

How do households produce goods and services?

Answer 36

They sell their labour in exchange for income.

Question 37

How does the government depend on businesses and individuals?

Answer 37

They pay tax

Question 38

What is tax used for (apart from Nkandla)?

Answer 38

To build roads, create jobs, offer education and health services.

Question 39

Are households consumers or producers?

Answer 39

Both

Question 40

How do we know that consumers are not using their goods and services efficiently?

Answer 40

There is wastage of goods

Question 41

What are the disadvantages of waste products?

Answer 41

They make our water, air and land unhealthy and cause pollution

Question 42

Where is solid waste sent if we don't recycle it?

Answer 42

landfill sites

Question 43

How can we reduce the damage caused by waste products?

Answer 43

Re-use waste Re-cycle materials Manufacture other products from recyclable materials

Question 44

What are goods?

Answer 44

Things that we consume

Question 45

What are services?

Answer 45

Work done for the benefit of others

Question 46

What is a government agency?

Answer 46

an organisation in government that supplies services or goods to the public

Question 47

What are entrepreneurs?

Answer 47

people with skills that start their own businesses

Question 48

What are operating costs?

Answer 48

The costs of running a business

Question 49

What is a grant?

Answer 49

An amount given to by the government to a household or individual to compensate for adverse circumstances - e.g. a disability or poverty

Question 50

What is a market share?

Answer 50

The part of the market which buys your goods or services.