what is the economy

Question 1

economics

Answer 1

The study of the system in which land, labour and capital resources are distributed


Question 2

trade

Answer 2


An exchange of goods and services between consumers 
and producers

Question 3

an economy

Answer 3


A system within which land, labour and capital resources 
are distributed

Question 4

land resource

Answer 4


Resources that occur in nature such as minerals, water, forests, land, animals, agricultural products etc


Question 5

labour resource

Answer 5


The mental and physical effort by humans that contribute to production processes. Enterprise resources – human thought and initiative are included in this category


Question 6

capital resource

Answer 6



Resources such as machinery, roads, shipping ports, communication networks etc that are used in the production
of other goods and services

Question 7

exports

Answer 7

A function of international trade whereby goods produced in one country are shipped to another country for future sale
or trade


Question 8

imports

Answer 8

Goods or services brought into one country from another

Question 9

specialisation

Answer 9


The shift that occurs when labour forces move away from generalist work into specialist jobs that focus on producing certain types of goods or services

Question 10

interdependance

Answer 10


A feature of modern economies where people and groups specialise in producing a particular goods or services, and then depend on other specialists to produce the other goods and services to satisfy their needs and wants.

Question 11

mechanisation

Answer 11


The use of large-scale machines in the production process, 
which limits the need for a large labour force.


Question 12

industrialisation

Answer 12


The process of increasing the range of industries within an economy, and moving away from traditional methods in favour 
of mechanisation

Question 13

circular flow

Answer 13


A model of an economy that shows the movement of resources and money between groups and sectors in the economy 
A model of an economy that shows the movement of resources and money between groups and sectors in the economy

Question 14

infrastucture

Answer 14

Capital resources such as roads, bridges, communication networks and shipping ports that increase the productive capacity of a country

Question 15

opportunity cost

Answer 15

A cost that limits or removes the possibility of other 
alternatives or benefits

Question 16

recession

Answer 16


A significant decline in activity across an economy (lasting longer than two consecutive quarters)


Question 17

boom

Answer 17


A very rapid increase in economic activity and the sale of goods and services


Question 18


Economic Development

Answer 18


The rate at which a traditional or developing economy is moving towards a more modern economy


Question 19

Economic Growth

Answer 19


The increase in an economy’s capacity to produce goods and services over time

Question 20

sector

Answer 20


A method of dividing the labour force into specific industries according to the type of work they do or the particular goods/service they produce