6908685
Description
Flashcards by Alfie Scott, updated more than 1 year ago
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Created by Alfie Scott
over 7 years ago
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| Question | Answer |
| Positive Statement | A statement of fact that can be scientifically tested to see if it is correct or incorrect. |
| Normative Statement | A statement that includes a value judgement and cannot be refuted by just looking at the evidence. |
| Need | A necessity for human survival such as food, clothing, warmth or shelter. |
| Want | Something that is desirable, such as fashionable clothing, but is not necessary for human survival. |
| Economic Welfare | The economic well-being of an individual, a group within society or an economy. |
| Production | A process, or a set of processes that converts inputs into outputs of goods. |
| Capital Good | A good which is used in the production of other goods or services. Also known as a producer good. |
| Consumer Good | A good which is consumed by individuals or households to satisfy their wants and needs. |
| Factors Of Production | Inputs into the production process, such as land, labour, Enterpise and Capital. |
| Finite Resources | A resource such as oil, which is scarce and runs out as it is used. Also known as a non-renewable resource. |
| Renewable Resource | A resource, such as timber, that with careful management can be renewed as it is used. |
| Fundamental Economic Problem | How best to make decisions about the allocation of scarce resourcesamong competing uses so as to improve and maximize human happiness and welfare. |
| Scarcity | Results from the fact that people have unlimited wants but resources to meet these wants are limited. In essence, people would like to consume more goods and services than the economy is able to produce with its limited resources. |
| Opportunity Cost | The cost of giving up the next best alternative. |
| Economic Growth | The increase in the potential level of real output the economy can produce over a period of time. |
| Full enployment | When all who are able and willing to work are employed. |
| Unemployment | When not all of those who are able and willing to work are employed. |
| Choice | Choosing between alternatives when making a decision on how to use scarce resources. |
| Resource Allocation | The process through which the available factors of production are assigned to produce different goods and services, e.g how many of the society's economic resources are devoted to supplying different products such as food, cars, healthcare and defence. |
| Productive efficiency | For the economy as a whole occurs when it is impossible to produce more of one good without producing less of another. For a firm it occurs when the average total cost of production is minimized. |
| Allocative Efficiency | Occurs when the available economic resources are used to produce the combination of goods and services that best matches people's tastes and preferences. |
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