Unit 1- The economic problem Flashcards
What are the factors of production?
The resources available to produce goods and services.
What is the economic problem?
The issue of scarce resources and unlimited wants.
Name the four factors of production?
Capital, enterprise, land and Labour.
What is Labour?
It is the human input into the production process.
What is land?
All the land, sea and resources used in the production process.
What is capital?
It refers to goods that are used to produce other goods.
What is enterprise?
It is having ideas and taking risks in setting up or running a business.
What is the primary sector?
Where the extraction of raw materials take place.
What is the secondary sector?
Where raw materials are manufactured into goods.
What is the tertiary sector?
The service sector e.g. Retail and public services.
What is opportunity costs?
The next best alternative foregone when making a choice.
What is a market?
Where buyers and sellers meet to exchange goods and services.
What is a market economy?
It is where all resources are allocated by private individuals and groups.
What is a planned economy?
Where all resources are allocated by the government.
What is a mixed economy?
Whee some resources are allocated the the government and other resources are allocated by private individuals.
