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Economics Final Rev.
Review for the May 31 Final
Question | Answer |
---|---|
What are the two definitions of Economics? | The STUDY of how things are bought and sold The STUDY of how people seek to satisfy their needs and wants by making choices. |
What are goods? | Physical objects that can be bought or sold. |
What are services? | They are actions and activities that one person performs for another in exchange for payment. |
What are needs? | Something like, air, food, or shelter that is necessary for survival. |
What are wants? | An item we DESIRE but that is not essential to survival. |
What is a resource? | Anything used to produce goods or services. |
What does the term production mean? | It is the process of changing raw materials into economic goods that can be used to satisfy the needs and wants of consumers. |
What is scarcity? | The fact that there are limited quantities of resources to meet our unlimited wants. |
What does the term microeconomics refer to? | The STUDY of economic decisions made by consumers and producers that effect INDIVIDUALS in an economy. |
What does the term macroeconomics refer to ? | The STUDY of economic decisions that effect the economy of a NATION. |
What are the Factors of Production? | They are the resources needed to produce good and services. |
Define what "land" refers to with respect to the study of Economics. | ALL of the NATURAL resources that are used to produce goods and services. |
Define what "labor" refers to with respect to Economics. | The MENTAL and PHYSICAL work that people are paid to do in order to produce goods and services. |
What does the word CAPITAL mean? | Anything that is used to produce goods and services ( tools machines, equipment, trucks...etc) |
Describe what an entrepreneur is . | It is a person who decides how to combine resources ( land , labor,and capital ) to create new goods and services. |
What type of interest rate do you want when you borrow money? | A low interest rate because you will be paying the money back. |
What type of interest rate do you want when you open a savings account? | A high interest rate because you can earn a small amount of money on your savings. |