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Scarcity & Choice
Term | Definition |
---|---|
Economics | The study of how people, businesses and governments with limited resources make choices that satisfy their needs. |
Economic resources | The factors or inputs used to produce and distribute goods services and wealth |
Financial Cost | The price of the item we choose to buy |
Opportunity Cost | All the other things we could have done with our resources |
Rational Gain | Where the expected gains outweigh the expected loss |
Factors of production | The economic resources needed to produce the good sand services we need and want |
Land | Anything provided by nature and used to make goods and services. It's reward is rent |
Labour | The people involved in producing the goods and services we need and want. It's reward is wages |
Capital | Physical items made by people and used in the production of goods and services. It's reward is interest |
Enterprise | Any attempt to start of make something new. It's reward is profit |
Supply | Supply is the quantity of a resource that is available at a given time or price |