Question | Answer |
What is the difference between a need and a want? | A need is required for survival and a want is a luxury. |
What is economics? | A social science that studies how people allocate their limited natural resources |
What is the driving force of economics? | To distribute limited resources to satisfy unlimited wants and needs |
Why is Economics a social science? | Because it looks at the behaviors of people |
What are goods? | Something that people want. Can be touched. |
what are services? | Work for another; helpful or professional activity. |
What is microeconomics? | The economy of the individual or firms |
What is macroeconomics? | The economy as a whole |
What is scarcity? | The reason for economics - resources are limited yet wants and needs are unlimited |
What are the factors of production? | Items used to produce goods and services, including land, labor, capital, entrepreneurship |
Land? | natural resources not created by effort of man, are fixed or limited in supply. Examples of land: water, sunlight, oil, whales |
Incentive? | A reason for doing something. A reward for making a choice or behaving a certain way. |
Labor? | Human resources, workers. Examples of labor: effort, ability, and skills of humans used in production |
Marginal? | Extra or additional |
Capital? | What is needed to made product. Examples of capital: Tools, equipment, and factories, money, training and education |
Market? | An arrangement that allows buyers and sellers to make exchanges. |
Entrepreneurship? | Brings together the factors of production, the risk taker in search for profit |
What questions are answered by studying about Economics? | What, How, For Whom? |
What is opportunity cost? | The cost of the next best alternative use of time, money, or resources |
What is a trade-off? | An alternative choice regarding income or time |