Resources Flashcards
What are free goods?
Goods so abundant that there is NO scarcity. They have NO price.
What are economic goods?
Scarce goods that have a price.
How are economic goods allocated?
The price system (90%)
Rationing-vouchers
Queuing- First in first served
How do we know an economic good is very scarce?
The price is very high!
What are the Resources of an economy?
Land
Labour
Capital
Entrepreneurship
Define Land
Raw materials used in production and a gift of nature.
Define Labour
Human effort in production of goods and services.
Define Final Goods
Consumer goods available for consumption for needs and wants.
Define Durable Consumer goods?
Consumer goods that last for a long time. e.g. Car, House etc.
Define Non-durable consumer goods?
Consumer goods that are used up immediately. e.g. food, drinks, etc.
Types of production?
Goods:Capital, Consumer
Services:Business, Consumer
Renewable Resources?
Raw Materials that cannot be replaced or replenished
- Oil
- Gold
- Silver
What is a Subsistence society?
Everybody is independent working to stay at the same point as before and no surplus.
What is independence?
You rely on yourself and do not rely on others.
What is specialisation?
Individuals concentrating on a specific task. To become an expert at it.
What is division of labour?
Breaking down the production process into smaller tasks so a worker becomes a specialist.
What is Division of Labour by Product?
Individuals concentrating on producing a specific good or service.
What is a benefit of specialisation?
Gained more means.
Higher quality goods and services more effectively.
What is Interdependence?
A situation where you rely on others and they rely on you for success.
What is dependence?
You rely on others and they do NOT rely on you e.g. baby and mother.
What is a disadvantage of Specialisation?
Interdependence, Boring(repetitive) and Your skill may not be wanted.
What is division of labour by process?
Where individuals breakdown the production of a product or service into smaller tasks and specialise at that task.`
Advantages of Division of Labour by Process?
More efficiency, a bigger surplus then before, more productivity, surpluses are now able to be traded and imports/exports.
What is the three major innovations to improve surpluses in economy?
Mechanisation, division of labour by product and Division of labour by process
