Factors of Production
Vocabulary / PPF
Intro to Economics
Know the Difference!
Types of Economies
100

Define entrepreneur and give an example.

An entrepreneur is someone who combines resources (land,labor,capital) to create a new good or service. 
100

Why do we study PPF curves?

To see alternative ways to use an economy's productive resources and the costs of doing so.

100
What is the study of how society satisfies endless wants and needs with scarce resources?
Economics
100
In economics what is the cost of passing up the next best choice when making a decision called?
Opportunity Cost
100

Name one type of economy and give an example 

Ex: Mixed Economy - the United States

200
Explain how a drinking fountain is a land factor or production and an example of physical capital.

Drinking fountain - tool used inside the school, part of infrastructure

Water - land resource 

200

Why do we want to produce on the PPF curve itself? 

Because that is where we are using our resources the most efficiently, and maximizing production!

200
What's one example of a "want"?
Television, Designer Clothes, etc. (Anything that is not a need)
200

What is the opportunity cost of going to college full time?

The time/money you could earn at a job in those 4 years in the work force.

200

Which type of economy is a synonym for capitalism and free enterprise?

Market Economy / Free Market Economy

300

A tractor is what type of resource (in the factors of production)?

A tractor is an example of physical capital.

300

A point to the left of / under the curve would indicate....

underutilization of resources and the economy

300
Define Scarcity
Lack of available resources to satisfy all desired uses of those resources.
300

Explain the difference between opportunity cost and trade offs (provide examples).

Opportunity Cost - next best alternative

Tradeoffs - cost/benefits BEFORE the decision is made

300

Who answers the basic economy questions in a command economy AND which type of government system (socialism, capitalism, communism) most closely reflects it?

A central government ; communism

400

Explain the difference between human and physical capital, and provide examples of each.

Human Capital - knowledge, skills

Physical Capital - tools/buildings/infrastructure to help you make a good/service

400

What happens when you attempt to produce above a PPF curve? Why?

Producing above a PPF curve is impossible because you do not have enough resources to produce at that point on the graph.

400
What is the difference between a want and a need?
Needs are our basic needs to survive, food, clothes, and shelter. Wants, put simply, are everything else and they are unlimited.
400

What's the difference between scarcity and shortage?

Scarcity - unlimited wants vs limited resources (natural resources typically)

Shortage - temporary supply deficit

400

What does it mean when economists debate about 'guns vs. butter' in the economy?

Guns vs butter is the relationship between social services and the military and how the government chooses to fund each one, making trade offs. 


500

Name the four factors of production and PROVIDE EXAMPLES OF EACH.

Land

Labor

Capital

Entrepreneurship

500

Explain TWO possible reasons that a PPF curve could shift outward and explain what it means for the economy.

Ex: more workers, technology increase, more resources to use, etc.

500

Explain the Circular Flow Model (Market for Resources AND Market for Goods and Services)

In the market for resources, firms acquire factors of production (land, labor, capital, entrepreneurship) from households, and in return, households get a wage/salary. 

In the market for goods and services, firms give households completed goods and services in exchange for revenue/money for the product. 

500

What are the three economic questions?

What to produce?

How to produce?

For whom to produce?

500

Name these things in relation to HEALTHCARE:

1. Advantage of a command economy

2. Disadvantage of a free market economy 

Command economy - equal access to healthcare and education

Free Market - impoverished don't have as much access to healthcare or education

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