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Economics
Things to remember :)
| Question | Answer |
|---|---|
| Define Economics | Economics is the study of the use of scarce resources to satisfy unlimited human wants. |
| Define Classical Economics | Classical economics refers to a body of work on market theories and economic growth which emerged during the 18th and 19th centuries. |
| Define Microeconomics | Microeconomics studies the decisions of individuals and firms to allocate resources of production, exchange, and consumption. |
| Define Macroeconomics | Macroeconomics is the study of whole economies--the part of economics concerned with large-scale or general economic factors and how they interact in economies. |
| Define Scarcity | Scarcity is the concept that resources are only available in limited supply. In general, scarcity refers to the idea that resources are limited, but our wants and needs are unlimited. |
| Define Choice | Choice refers to the ability of a consumer or producer to decide which good, service or resource to purchase or provide from a range of possible options. |
| Define Efficiency | Economic efficiency is when all goods and factors of production in an economy are distributed or allocated to their most valuable uses and waste is eliminated or minimized. |
| Define Allocative Efficiency | An optimal distribution of goods and services taking into account consumer's preferences. |
| Define Equity | Equity mean recognizing that we do not all start from the same place and we must acknowledge and make adjustments to imbalances. |
| Define Economic well-being | Economic well-being refers to the overall standard of living and quality of life of individuals and households within an economy. |
| Define Sustainability | Meeting the needs of today's society without jeopardizing the needs of the future generations. |
| Define Change | Economic change can be defined as a shift in structure, policy or growth in the economy. |
| Define Interdependence | Economic interdependence is the situation where two or more parties (individuals, businesses, companies, countries, etc.) depend upon each other for the exchange of goods and the fulfillment of their necessities. |
| Define Intervention | Economic intervention is when a nation's government takes action to alter the economy for political purposes. |
| Define Resources | Things that are needed to produce goods and services. (land, labor, capital, and entrepreneurship) |
| Factors of Production | The factors of production are the inputs used to produce a good or service in order to produce income. (land, labor, capital, and entrepreneurship) |
| Define Land | Land comprises all naturally occurring resources as well as geographic land. Income for land is rent. |
| Define Labour | In economics, labor is the measure of work done. The income for labour is wages. - Human Capital |
| Define Human Capital | The term human capital refers to the economic value of a worker's experience and skills. Human capital includes assets like education, training, intelligence, and skills, |
| Define Capital | Capital is a broad term for anything that gives its owner value or advantage, like a factory and its equipment. - Manmade resources used to make final goods and services. The income from capital is interest |
| Define Entrepreneurship | Entrepreneurship is the process of discovering new ways of combining resources. The income for entrepreneurship is profit |
| Define Opportunity Cost | Opportunity cost is money or benefits lost by not selecting a particular option during the decision-making process. |
| Define Free Goods | A free good is a good that is not scarce, and therefore is available without limit. E.G. air, wind, solar, water |
| What are the three basic economic questions? | What/how much to produce? How to produce? For whom to produce? |
| Define Redistribution of income | Redistribution of income and wealth is the transfer of income and wealth (including physical property) from some individuals to others through taxation, public services, divorce, etc. |
| Define Government intervention | Government intervention is regulatory action taken by government that seek to change the decisions made by individuals, groups and organisations about social and economic matters. |
| Define Free market economy | The free market is an economic system based on supply and demand with little or no government control. |
| Define planned economy | A planned economy can be defined as a type of economic system where financial decisions are made according to government plans. |
| What is a Production Possibilities Curve (PPC)? | A graphical model that represents all of the different combinations of two goods that can be produced; the PPC captures scarcity of resources and opportunity costs. |
| Define Economic growth | Economic growth is an increase in the production of goods and services in an economy. Increases in capital goods, labor force, technology, and human capital can all contribute to economic growth. |
| Define Actual growth | Actual growth which takes place when an economy is below full employment level of income and moves towards its potential level of GDP (by employing more of its resources). |
| Define Potential growth | Potential growth is associated with the increase in quantity and/or quality of factors of production. |
| What is the Circular Flow of Income Model | The circular flow model demonstrates how money moves from producers to households and back again in an endless loop. |
| Define households | A household is a small group of persons who share the same living accommodation |
| Define Firms | A firm is a business organization that produces and sells goods and services with the aim of generating revenue and making a profit. |
| Define Injections | An injection occurs when funds are added to an economy from a source other than households and businesses. (Government spending, Investments, and exports) |
| Define leakages | Leakage occurs when there is a withdrawal of money from the economy. (Taxes, Savings, Imports) |
| Define Imports | An import is a good or service bought in one country that was produced in another. |
| Define Exports | Exports are defined as movable goods produced within the boundaries of one country, which are traded with another country. |
| Define Government spending | Government spending is the aggregate expenditure by local, state, and national governments on goods and services. (Salaries, public infrastructure) |
| Define Taxation | A tax is a mandatory payment or charge collected by local, state, and national governments from individuals or businesses to cover the costs of general government services, goods, and activities. |
| Define Investments | Investment is defined as the commitment of current financial resources in order to achieve higher gains in the future. |
| Define Savings | Saving, process of setting aside a portion of current income for future use |
| Define ceteris paribus | "all other things being equal." |
| Define positive economics | Positive economics is an objective stream of economics that relies on facts or what is happening. (Can be backed up by data) |
| Define Normative economics | Normative economics is concerned with the exploration of what “should be” in the economy. (Based on value judgements, cannot be proved or disproved) |
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aesthetic_studies