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Economics F581
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- 1Define the economic problemThere are limited economic reasources to meet unlimited human wants.
- 2Name & Explain the 4 factors of productionLAND ~ includes all naural resources
LABOUR ~ the human effort
CAPITAL ~ manuactured resources which have been made in order to make things
ENTERPRISE ~ brings together the other factors in order to produce a product profitably - 3Define opportunity costThe cost of a decision in terms of the beneits of the next best alternative forgone
- 4Define specialisationoccurs when indvidual workers concentrate on a particular task within the production process
- 5What does a PPC curve show?The maximum potential output of 2 goods that can be produced in the current time period if all resources are eficiently employed
- 6What causes an outward shift in production possibility curves?The quantity and/ or quality of its economic resources have increased
- 7What causes an inward shift in production possibility curves?A decline i the quantity and/ or quality of its economic resources
- 8What is a market economy?prices and the operation of the price mechanism create incentives that direct resources to where they are most needed
- 9What is a command economy?The government takes control of resource allocation. All businesses are state ownd enterprises
- 10What is a mixed economy?In reality all ecomonies are mixed. Resources are allocated through a combination of market forces and government direction
- 11Define & Explain the 4 functions of moneystandard for deferred payment ~ arrange to pay for a good today for the future
store of value ~does not lose its value for future payments
unit of account ~ value goods in money terms
medium of exchange ~ used t exchange goods and services - 12Define marketwherever consumers and producers come together for the purpose of exchange
- 13Define demandRefers to the quantity of a product that buyers are willing and able to buy at various prices over a period of time, ceteris paribus
- 14Define consumer surplusthe difference between the price a consumer actually pays for a product and the price they are willing to pay
- 15Determinants of demand1. Changes in price/availability of substitue goods
2. Changes in price/availability of complementary goods
3. Change in income of consumers
4. Changes in population
5. Expectations about future rice movements
6. Changes in tastes - 16Define supplyrefers to the quantity of a product that suppliers are willing and able to sell at various prices per period of time, ceteris paribus
- 17Producer surplusThe difference betwen the price that suppliers are willing and able to supply at and the price they actually get
- 18Define price elasticity of demandthe sensitivty f quantity demanded to a change in price
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- Fichas sobre Economics F581, creado por leighrowland el 20/02/2014.
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