Basic Economic Concepts
This is the study of how individuals and societies allocate scarce resources to satisfy unlimited wants.
What is Economics?
This man-made resource, such as machinery or tools, is used in the production of goods.
This theory believes in minimal government intervention and free markets driven by supply and demand.
Classical Economics or Free Market Economics?
Known as the "father of modern economics," he introduced the idea of the invisible hand and the division of labor.
Who is Adam Smith?
The act of choosing one option over another due to scarcity is called this.
What is a trade-off?
The basic economic problem where resources are limited while wants are unlimited.
What is Scarcity?
The efficiency with which goods and services are produced, often measured as output per worker.
What is productivity?
This economic theory advocates for government intervention to manage economic fluctuations.
What is Keynesian Economics?
This term refers to the skills, knowledge, and experience possessed by individuals, contributing to productivity.
What is human capital?
The value of the next best alternative that is given up when making a choice is known as this.
What is opportunity cost?
These are the resources used to produce goods and services, such as land, labor, and capital.
What are the Factors of Production?
The splitting of tasks in a production process to increase efficiency is called this.
What is division of labor?
This framework uses simplified representations to predict economic behavior or outcomes.
What is an economic model?
This economist developed the theory of Keynesian Economics, which supports government intervention.
Who is John Maynard Keynes?
This curve shows the possible combinations of goods or services that can be produced, revealing trade-offs.
What is the Production Possibilities Curve?
Natural resources like water, minerals, and forests fall under this factor of production.
What is land?
When a worker focuses on one specific task or product, it’s known as this.
What is Specialization?
This curve shows the trade-offs between two goods or services that an economy can produce.
What is the Production Possibilities Curve?
This model shows how money, goods, and services move between households and businesses in an economy.
What is the circular flow model?
Intangible actions or activities provided to others, such as education or healthcare, are called this.
This is the increase in a country’s output of goods and services over time.
The dependency of countries or regions on each other for goods and services is called this.
What is Economic Interdependence?
This branch of economics focuses on the performance, structure, and behavior of an entire economy, including issues like inflation, unemployment, and national income.
What is macroeconomics?