The Economic Problem Flashcards
(12 cards)
1
Q
Ceteris Paribus
A
The assumption that all things remain constant
2
Q
Positive Statements
A
Fact based, objective, testable theories
For example: ‘income isn’t equal in all countries’
3
Q
Normative Statements
A
Value judgments, subjective, opinions
For example
4
Q
Economic Problem
A
How will we satisfy our unlimited needs + wants with finite recourses
5
Q
C
E
L
L
A
capital
Enterprise
Land
Labor
6
Q
Renewable
A
Solar panels
7
Q
Non-renewable
A
Coal
Gas
Fuel
8
Q
Opportunity Cost
A
Cost of sacrificing the next best option
9
Q
P
P
F
A
Production
Possibility
Frontier
10
Q
Explain How PPFs Illustrate Opportunity Costs
A
The idea of shifting production from a to be along the ppf
11
Q
Examples of Capital Goods
A
Machinery
Property
Vehicles
12
Q
Examples of Consumer Goods
A
Food
Cars
Clothing
