1.1.3-1.1.4 Flashcards
(18 cards)
what is a consumer durable?
products that provide a steady flow of satisfaction/utility over their working life
e.g washing machines
what is a consumer non-durable?
products that are used up in the act of consumption.
e.g coffee, heating
what is an example of consumer service?
a hair cut or movies
what is a capital good?
goods that are used to make consumer goods and services, it includes fixed plants and machinery
what are the factors of production?
land, labour, enterprise, capital
what is economic activity?
it is to satisfy the needs and wants of society
what are the 3 main qs of factors of production?
how to produce, what to produce, who to produce for
what is ppf?
a graphical representation that illustrates the maximum output of two goods or services that an economy can produce given its available resources.
what is ppf?
a graphical representation that illustrates the maximum output of two goods or services that an economy can produce given its available resources.
what is scarcity?
the limited goods and resources in relation to the unlimited wants and needs of a society
what is a trade off
the ppf reflects the idea that an economy must make trade-offs when allocating it’s resources
what does it mean when the ppf curve shifts outwards?
the economy has grown, technological advancements, improvements in productivity
why are ppf curves always concave?
if the law of diminishing returns holds true then the opportunity costs of expanding output of x is measured in terms of lost units of y is increasing
what is efficiency?
using available resources at maximum capacity
what is allocative efficiency?
how effectively you are allocating your resources
what is allocative efficiency?
how effectively you are allocating your resources
what productive efficiency?
producing an output at the lowest possible cost
what is dynamic efficiency?
technological advancements or discovery of a new natural resource
