The Economic Problem Flashcards
1
Q
The economic problem
A
Infinite number of wants, finite number of resources
2
Q
Law of diminishing returns
A
The more of a resource you get the harder is to find or recieve
3
Q
The central purpose of economic activity
A
Produce goods and services to satisfy needs and wants
4
Q
Sustainable resources
A
Ones used for economic activity in a manner that will not run out
5
Q
Characteristics of a free market
A
Competition
Freedom of choice
Privately owned business
Profit kept by individuals
6
Q
Characteristics of a command economy
A
No competition
No self interest
Businesses government owned
Price controls
7
Q
Economic agents
A
Consumer
Government
Firms
8
Q
Positive statement
A
Objective
9
Q
Normative statement
A
Opinionated and subjective
