Recources Flashcards
How are scarce resources allocated?
The price system
Rationing-Via vouchers
Queuing system-First in first serve
What are free goods?
Goods are so abundant that there is no price.
What are economic goods?
Scarce goods that are allocated by the price system, rationing, and queuing
What happens if goods are really scarce.
The price rises.
What are the recources
Land
Labour
Capital
Entrepreneurship
Define Land
Raw materials supplied by nature.
Define Labour
Human recourses or human effort
Define capital
Man made recourses used to assist production
Define entrepreneurship
The person who takes the risk of organising the other factors of production to achieve a profit from production
What are other names for recources
Factors of production or inputs to production
What types of production are there?
Goods
Services
What types of goods are there?
Consumer Goods
Capital goods
What type of consumer goods are there?
Durable goods
Non-Durable goods
Define Consumer goods
Goods to assist consumers satisfaction for needs + wants
What are the two differences between needs + wants?
Needs are needed to sustain life where as wants are not. Needs are limited where as wants are unlimited.
Renewable Recourses?
Natural recources that will replenish in 100 years.
Oil, Gold, Coal
What is a subsistence Economy?
Everybody works independently just to maintain their current living standards. There is no surplus produced.
What is independent?
You rely on yourself for needs and wants and not on others.
What is specialisation?
Individuals concentrating on one task to improve productivity and efficiency.
What is division of labour?
Breaking down the production process into small tasks.
What is division of labour by product?
Breaking the labour to concentrate on 1 specific type of production.
- Farming
- Fishing
- Construction
What is the benefit of division of labour/specialisation
- More goods and services
- Higher production and efficiency
- Higher quality
- Greater surplus
What methods can producers use to increase surplus of production?
- Division of labour by product
- Division of labour by process
- Mechanisation
What is a disadvantage of specialisation
- You become interdependent
- Can be boring or repetitive
What is dependence?
Where you are reliant on others for your needs and wants, but they do not rely on you. e.g a baby and a mother.
What is interdependant
When you rely on someone and they rely on you to get the needs and wants.
What can a surplus be used for
- Storage
- Trading
- More leisure
