Key Economic Concepts Flashcards
(11 cards)
What is scarcity?
The problem of people having unlimited needs and wants but limited resources to support those needs and wants.
Scarcity forces individuals to make choices due to limited resources.
What does making choices refer to in economics?
The way consumers make decisions about what they buy to satisfy their needs and wants, and how producers decide what to produce with scarce resources.
Choices are influenced by the problem of scarcity.
What is interdependence in economics?
The connections between different groups in an economy and how the actions of one group impact the other groups in the economy.
Interdependence illustrates how economic actions affect others.
Define specialisation in economics.
Focusing on producing something in particular.
Specialisation allows for increased efficiency and productivity.
What is trade?
The exchange of goods and services between individuals, states, and/or countries.
Trade is essential for economic interaction and growth.
What does allocation mean in the context of economics?
How we distribute scarce resources among producers.
Allocation is crucial for efficient resource management.
What are markets in economic terms?
The exchange of resources among buyers and sellers.
Markets facilitate trade and resource allocation.
What is economic performance?
Measuring how well the economy is doing.
Economic performance indicators include GDP, unemployment rates, etc.
Define living standards.
The level of wealth, material goods, comfort, and life necessities available to people living in a geographical area.
Living standards are often used to assess quality of life.
Fill in the blank: The problem of scarcity leads to _______.
Making choices.
True or False: Specialisation can lead to increased productivity.
True.
