lesson 5- factors of production+ lesson 6- utility Flashcards

1
Q

what are the factors of production?

A

Capital- anything that helps provide a good
or service
Enterprise- ideas to create a product/service
Land- the area and natural resources used
Labour-total workforce used to create

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2
Q

what should you consider in terms of Land

A

size
geography
natural resources
fertility
price

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3
Q

what should you consider in terms of Labour

A

age profile
education
experience
cost/wages
employment law
availability
unemployment rate

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4
Q

what should you consider in terms of capital

A

costs
time
efficiency
durability
reliability
size
safety
ARR
interest rate

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5
Q

what should you consider in terms of Enterprise

A

qualities of entrepreneurs
imagination
initiative
perseverance
risk taking
resilient
good communicator

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6
Q

what is the production possibility frontier
draw + label A,B,C

A

on line=maximum output
under line=not maximum output
above the line=impossible now
google for more

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7
Q

what is utility?

A

the measurement of consumer satisfaction
aim is to maximise utility

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8
Q

what is marginal utility?

A

the addition to total utility gained from consuming one extra unit
-as more units of a good are consumed, marginal utility falls

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