Basic Economic Problems

Question 1

Opportunity cost meaning?

Answer 1

Measure of the cost, of the sacrifice, of the next best alternative.(what u sacrifice)

(E.g I want pizza and McDonald’s.But only have £10. I get a pizza.
McDonald’s= opportunity cost

Question 2

Positive statements can be …..

Answer 2

Tested

Question 3

Positive statements are…..

Answer 3

Subjective statements

Question 4

Normative statements can’t be…..

Answer 4

Tested

Question 5

Normative statements are …..

Answer 5

Opinions!

E.g. Ronaldo is the goat=Normative statement

Question 6

What is,the central purpose of economic activity?

Answer 6

Production of Goods/services to satisfy needs/wants.

Question 7

4 Factors of production?

Answer 7

Land
Labour
Capital
Enterprise

Question 8

Factors of production meaning?

Answer 8

The inputs used to supply goods/services.(in an economy)