Key terms

Question 1

Microeconomics

Answer 1

Branch of economics that studies how households and businesses (firms) reach decisions about buying, saving, setting prices, competition etc.

Question 2

Positive statement

Answer 2

A statement that is factual and can be verified as true or false (based in evidence, tested)

Question 3

Normative statement

Answer 3

An opinion/viewpoint that others that may agree or disagree with

Question 4

Value Judgements

Answer 4

An assessment of something good or bad. All value judgements will be normative but not all normative statements will be value judgements.

Question 5

Goods

Answer 5

Physical services that you can touch e.g. books, factories

Question 6

Services

Answer 6

Intangible things such as teaching or a train journey

Question 7

Economic welfare

Answer 7

The level of wealth and the quality of living standards in an economy

Question 8

Finite

Answer 8

Non renewable- Cannot be replaced once used e.g. oil, coal, lithium, zinc

Question 9

Renewable

Answer 9

Can (with careful management) be renewed as it is used e.g. hydropower, wind energy, solar energy

Question 10

Need

Answer 10

Something that is essential for human survival e.g. food, clothes, warmth, shelter

Question 11

Want

Answer 11

Something you desire

Question 12

Opportunity costs

Answer 12

The next best alternative that is given up