LS 1

Question 1

What is an economy?

Answer 1

An economy is all the goods and services produced in an area

Question 2

What are the factors of production?

Answer 2

Capital
Enterprise
Land
Labour

Question 3

What is capital?

Answer 3

Capital are things which are used to make goods and services

Question 4

What is enterprise?

Answer 4

Enterprise is the willingness of people in business to take risks and make a profit

Question 5

What is land?

Answer 5

Land refers to natural resources such as oil, forests and land itself

Question 6

What is labour?

Answer 6

Labour is all of the work done by humans in production

Question 7

What is the economic problem?

Answer 7

How to use the available scarce resources to satisfy people’s infinite needs and infinite wants as effectively as possible

Question 8

What are economic agents?

Answer 8

Economics agents are groups that participate in the economy

Question 9

What are the three economic agents?

Answer 9

Consumers
Suppliers
Government

Question 10

What are the three key questions relating to the basic economic problem?

Answer 10

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