Micro definitions 1

Question 1

social science

Answer 1

Studies society as a whole and the RS of the individuals within said society

Question 2

Positive Statements

Answer 2

do not have to be correct but must be able to be scientifically tested, proved, disproved

Question 2

Normative Statements

Answer 2

Based on value judgements and so cannot be proved or disproved

Question 3

Scarcity

Answer 3

Insufficient resources to meet peoples unlimited wants

When people would like to consume more products than the economy is capable of producing with its limited resources

Question 4

Goods

Answer 4

Tangible products that can be touched and measured eg food

Question 5

Services

Answer 5

Intangible items that cannot be touched or measured eg banking

Question 5

Utility

Answer 5

Total satisfaction received from consuming a good or service

Question 5

Needs

Answer 5

Goods/services required to maintain existence/life eg shelter

Question 5

Wants

Answer 5

Goods/services that we desire but are not necessary for maintaining existence/life eg watches

Question 5

Renewable Resources

Answer 5

natural resources of economic value that can be replaced or replenished at a rate equivalent to their consumption eg wind energy

Question 6

Non-renewable/ finite resources

Answer 6

natural resources of economic value that cannot be readily replaced by natural means at a rate equivalent to that of their consumption eg coal

Question 6

Fundamental Economic Problem

Answer 6

How best to allocate scarce resources among their alt uses to max human happiness/welfare/utility

Question 7

Oppurtunity Cost

Answer 7

the cost of missing out on the next best alternative

Question 7

Economic Agents

Answer 7

Decision makers that have effects on the economy of a country by buying, producing, selling etc

Question 7

Household

Answer 7

Group of consumers that buy goods and services

Supply labour to firms to produce goods and services in order to earn income needed to purchase goods and services

Question 8

Firm

Answer 8

An org that uses factors of production alongside eachother in order to produce output.

Produce goods and services demanded by consumers

Question 8

Government

Answer 8

A governing body that undertakes expenditure and impacts the economy via tax and regulation of markets.

Question 9

Production

Answer 9

A process that converts inputs into outputs of goods and services

Question 10

Factors Of production

Answer 10

Available resource inputs used in the production process of goods and services

Question 11

Capital

Answer 11

Man-made aids ie goods made to make other goods
MERC:
Machines
Equipment
Robots
Computers

Question 12

Enterprise

Answer 12

Willingness of an entrepeneur to take risks and organise production

Question 13

Land

Answer 13

The natural resource that is available in an economy

Question 14

Labour

Answer 14

The human resource that is available in an economy

Quantity and quality of human resources

Question 15

Consumer Goods

Answer 15

Goods bought and used by individuals or households to satisfy heir needs or wants eg Watches

Question 16

PPF

Answer 16

curve showing the max quantities of different combos of goods/services that can be produced in a set time period given available resources are fully and efficiently employed.

Question 17

Specialisation

Answer 17

The focusing on the production of a narrow range of products

Question 18

Division of Labour

Answer 18

A process whereby the production process is broken down into a series of stages and workers are assigned to particular stages

Question 19

Productivity

Answer 19

Output of a good or service per factor of production per period of time

Question 20

Barter System

Answer 20

Relies on the exchange of goods and services for other goods and services without the use of money eg sack of potatoes for a cut of beef