Eco Flashcards
What are the three basic economic questions?
Who consumes the goods and services produced in society
What goods and services should be produced
How should the goods and services be produced
Defintion of opportunity cost
The loss of one alternative when one alternative is chosen
What are the three types of resources?
Land,labour,capital
Definitions of land,labour and capital
Land: naturally occurring goods
Labour: physical and intellectual skills
Capital: is the goods and services needed to make the finished product
What is a need and a want?
Need: something you have to have
Want: something you would like to have
Definition of scarcity?
The state of being scarce or in short supply
What is a substitute good?
Substitute goods are those goods which can be used in place for another good by the consumers to satisfy their needs and wants. Butter and margarine
What is a complimentary good?
Complimentary goods refer to those goods where the use of one good increases the use of another good. Xbox and Xbox games are an example.
What is the factor of production?
An economic term to describe the inputs that are used in the production of goods or services in the attempt to make a profit: land, labour, capital
What is the law of demand?
The higher the price of an item, the less that will be demanded
What is the law of supply?
The higher the price that can be gained for an item, the more that will be supplied
Factors that could increase the demand of a product?
Effective advertising
Change in weather/seasons
Change in fashion/taste
Factors to increase supply of a product?
Availability of resources
New discovery of raw materials
Increased labour force
What is trade?
The act of buying and selling goods and services
What is a tariff?
A tariff is a tax or duty to be paid on a particular class of imports and exports
