Economics Basics
What is the basic economic problem?
Scarcity
What are the four factors of production?
Land, Labour, Capital, Entrepreneurship
Name the three main types of economic systems.
Market economy, Command economy, Mixed economy
What is productivity?
Productivty is a measure of how efficienlty resources are used to produce goods and services.
Name the three basic economic questions.
What to produce? How to produce? For whom to produce?
What type of capital includes tools, machinery, and equipment?
Physical capital
In which economic system does the government make all economic decisions?
Command economy
What is specialization?
Focusing on producing a specific good or service efficiently.
What is the difference between a need and a want?
A need is essential for survival, while a want is something desirable but not necessary.
Which factor of production receives wages as a reward?
Labour
What is a mixed economy?
An economy that combines elements of both market and command economies.
How does division of labor increase productivity?
It allows workers to focus on specific tasks, improving efficiency.
Define opportunity cost.
The next best alternative foregone when a choice is made.
Who is an entrepreneur?
A person who takes risks to start and manage a business.
Name one advantage of a market economy.
Encourages innovation and efficiency.
What is the difference between capital-intensive and labour-intensive production?
Capital-intensive uses more machines, labour-intensive relies on human workers.
Give an example of opportunity cost in everyday life
Choosing to buy a phone instead of a laptop, where the laptop is the opportunity cost.
Give an example of how land is used in production.
A farmer using land to grow crops.
Give an example of a country with a mixed economy
The United States, Canada, or Jamaica.
What impact does technological improvement have on production?
It increases efficiency and lowers costs.