L1 - The Economic Problem

Question 1

What is economics?

Answer 1

The study of the economy

Question 2

What is the economy?

Answer 2

All goods and services produced in an area

Question 3

What is the difference between goods and services?

Answer 3

Goods are tangible whereas services are intangible

Question 4

What are the 4 factors of production?

Answer 4

Capital
Enterprise
Land
Labour

Question 5

What is enterprise?

Answer 5

The willingness of people in business to take risks and make profit

Question 6

What is the economic problem?

Answer 6

How to use all the available scarce resources to satisfy the infinite needs and wants as effectively as possible

Question 7

What are the 3 questions about the usage of resources?

Answer 7

What to produce?
How to produce it?
Who to produce it for?

Question 8

What are economic agents?

Answer 8

Groups of people that participate in the economy

Question 9

Who are the 3 economic agents?

Answer 9

Consumers - buy goods and services made by firms

Producers - create goods and services

Government

Question 10

What does the government do in the economy?

Answer 10

Sets rules for other economic agents

Can contribute to the economy by providing goods and services (healthcare + railways)