Nature And Purpose Of Economic Activity Flashcards
1
Q
What is the purpose of economic activity?
A
To produce goods and services to satisfy consumers wants and needs.
2
Q
Needs
A
Things people can’t live without a E.G. water
3
Q
Wants
A
Things people can live without but desire, E.G.smart phones.
4
Q
What is the basic economic problem?
A
There are finite resources on Earth to satisfy humans unlimited wants and needs.
It involves working out how to allocate limited resources as effectively as possible to satisfy peoples unlimited wants and needs .
5
Q
Three foundations of economic decisions.
A
What we produce.
How we produce .
Who we produce for .
