LS1 - The Economics Problem

Question 1

Difference between goods and services

Answer 1

Goods are tangible and services are intangible

Question 2

Factors of Production

Answer 2

Capital - Goods used to produce goods and services e.g Machinery
Enterprise - Willingness for people to take risks to make a profit
Land - All the natural resources within an area e.g water and oil
Labour - All of work done by humans

Question 3

Three questions for what to produce

Answer 3

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

Question 4

Economic Agents and examples of them

Answer 4

Economic agents are individuals that take part within an economy

Consumers buy services and goods from firms
Governments are provide goods and services like roads and NHS
Manufactures produce goods and services