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economics
Junior Cert business studies
| Term | Definition |
|---|---|
| Economics | is the study of how we make the best possible use of the world's scarce resource in order to satisfy the requirements of as many people as possible |
| Needs | are essential items required for survival in life |
| Wants | are any items we would like to have in addition to our needs |
| Factors of production | are those resources that help to produce a product or provide a service |
| Land | is anything provided by nature that helps to produce goods and services |
| Labour | is any human effort that helps to produce goods and service |
| Capital | is anything that made by humans that is then used to help to produce other goods and service |
| Enterprise | is that special from of human activity that organises the other factors of production and bears the risk involved in production |
| Inflation | is the increase in the general level of the price of goods and services over a period of time |
| Deflation | is the decrease in the general level of the price of goods and services over a period of time |
| Consumer price index (CPI) | is the official measurement of the rate of inflamation |
| Gross domestic product (GDP) | is the total amount of goods and services produced in an economy in one period |
| Gross national product (GNP) | is the Gross Domestic Product less profits sent sent out of the country by foreign-owned companies located in the country, plus profits returned to the country by local firms based abroad |
| Economic growth | occurs when more goods are produced in a country one year than were produced in the previous |
| Negative economic growth | occurs when the amount of goods and service produced one year is less than the amount produced the previous year |
| Free enterprise system (capitalism) | all resources are owned by private individuals or companies and are used for their benefit only |
| Centrally planned system (communism) | all resources are publicly owned i.e. owned by the government on behalf of the citizens |
| Mixed economy | allows most of the major economic decisions to be made by the private sector, but the government intervenes to make sure everyone has essential goods |
| Opportunity cost | is the cost of the item we do without when we have to make a choice between two or more actions |
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athlonebusinessstudies
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