The Economic Problem Flashcards
1
Q
What is the Economic Problem?
A
Economic Problem- allocate available scarce (finite) resources efficiently & effectively-satisfy a consumers 👨 👩 ♾🧴 & 🎧
2
Q
What are Economic Agents?
A
Economic Agents- groups- participate- economy
3
Q
Who are the Economic Agents and what do they do?
A
1) Government- sets rules- economic agents must follow & provides 🚘 & 🧹 - roads & healthcare 🏥
2) Producers- create 🚘 and 🧹
3) Consumers- buy 🚘 and 🧹 made by firms (businesses)- can be 👨 👩 or firms themselves
4
Q
What is an Opportunity Cost?
A
Opportunity Cost- value 💵 of next best alternative forgone (given up)
5
Q
How does Opportunity Cost relate to the Economic Problem?
A
Choosing how to allocate resources involves Opportunity Costs
6
Q
Who experiences Opportunity Costs?
A
All economic agents
