Markets in Action Flashcards
1
Q
What is the basic economic problem?
A
We have unlimited wants but the means and resources to fulfil these wants are scarce.
2
Q
What are the factors of production?
A
Land
Labour
Capital
Enterprise
3
Q
What is meant by factors of production?
A
Resource inputs that are available in an economy for the production of goods and services.
4
Q
What is the difference between a good and a service?
A
Goods- tangible products
Services- intangible products
5
Q
What are factor endowments?
A
The storage stock of factors of production.
6
Q
What is opportunity cost?
A
The cost of the next best alternative forgone when making a choice.
7
Q
How can governments make revenue?
A
Through taxation.
