vocab micro Flashcards
(15 cards)
What is a positive statement?
A statement that does not include a value judgement and can be tested against the facts or evidence.
What is a normative statement?
A statement that includes a value judgement and cannot be refuted just by looking at data or evidence.
What is a value judgement?
A view about what is right or wrong, good or bad in a moral sense. Statements that include value judgements often, but not always, contain the words ‘should’ or ‘ought’.
What is economic activity?
The production, consumption, exchange and distribution of goods and services.
What are economic resources?
Inputs into the production process that are needed to produce the goods and services that satisfy people’s wants. They are usually classified as land, labour, capital and enterprise.
What is land in terms of factors of production?
The factor of production that includes all the natural resources that are available on the earth. It includes the land and sea.
What is capital in terms of factors of production?
The human-made factor of production. Examples of capital include machines, tools, lorries and buildings.
What is labour in terms of factors of production?
The human resource. The contribution made by people to the production of goods and services.
What is an entrepreneur?
A person who organizes the other economic resources to allow goods and services to be produced.
What is enterprise?
Enterprise involves making decisions and taking risks.
What is a scarce resource?
A factor of production that is limited in supply. There are not enough available to satisfy people’s needs and wants.
What is scarcity?
The fundamental economic problem that results from limited resources and unlimited wants. It means that choices have to be made which have an opportunity cost.
