chapter 1 section 1 Flashcards
(18 cards)
What is scarcity?
the condition that results from society not having enough resources to produce all the things people would like to have
What is the fundamental economic problem facing all societies?
scarcity
what does scarcity consist of?
unlimited wants and limited resources
what are the three questions asked when producing things?
WHAT to produce
HOW to produce
FOR WHOM to produce
what is economics?
its the study of how people try to satisfy seemingly unlimited wants through the careful use of relatively scarce resources
What are needs?
they are basic requirements for survival
What is an example of a need?
food, clothing, shelter
What are wants?
things we would like to have but are not needed for survival
what is an example of a want?
entertainment, luxury clothing
what is “factors of production”?
resources required to produce the things we would like to have
what does the factors of production consist of?
land, labour, capital, and entrepreneurs
what is land?
a factor of production
deserts, forests, fertile fields, and livestock
they are a limited supply
what is labour?
people with all their efforts, abilities, and skills.
birthrates, war, famine, had an effect on the quality and quantity of labour
what is capital?
“capital goods”
tools, equipment, machinery, and factories used in the production of goods and services
it is the result of production as well
what are entrepreneurs?
they are innovators responsible for much of the change in our economy
they are risk takers in search of profits
they do something new with existing resources
why are entrepreneurs the driving force in an economy?
because they start new businesses and bring new products to the market
why are entrepreneurs excluded from labour?
because of their special role in our economy
what are the 4 key elements of social science?
description, analysis, explanation, prediction
