EC-070
Why are manufacturers crucial?
They turn raw materials into usable goods for consumers.
Why do natural resources become limited?
damage/pollution
What is the fundamental economic problem that necessitates the study of economics?
Scarcity
What is the Law of Demand?
It states that as the price of a product increases, the demand for it decreases, and as the price decreases, the demand for it increases.
What is the goal of a retailer?
To sell products to the final consumer
What are the three categories of economic resources?
Natural Resources, Human Resources, Capital Goods
What are the three basic economic questions that every economic system must answer?
What goods and services will be produced?
How will these goods and services be produced?
For whom will these goods and services be produced
What is the Law of Supply?
It states that as the selling price of a product increases, producers are willing to manufacture more of it, and as the price decreases, they produce less.
What are the three broad categories that cover all types of businesses?
The three broad categories are producers, trade industries, and service businesses.
Why are economic resources also known as "factors of production"?
They are the essential inputs that enable businesses to operate and produce the goods and services that consumers want
What is the definition of "Opportunity Cost"?
The benefit that is lost (the next best alternative) when you decide to use scarce resources for one purpose rather than another
What Factors Affect the Demand for Products?
Key factors include consumer income (buying power), utility (usefulness/desire), price of the product, price of related goods (substitutes or complements), and consumer expectations of future prices.
How do businesses show social responsibility?
By providing safe, high-quality products and, in some contexts, maximizing profits to contribute to public interests.
What are some ways producers respond to limited human resources?
Producers may increase wages/benefits, offer training, utilize automation, or implement flextime to attract workers.
What are the four types of economic resources used to produce goods and services?
Natural resources, human resources (labor), capital goods, and entrepreneurship
What Factors Affect the Supply of Products?
Key factors include the cost of production, number of producers in the market, future price expectations, disasters/emergencies, government regulations, and technology.
How does a raw-goods producer differ from a manufacturer?
A raw-goods producer provides goods in their natural state, while a manufacturer changes the shape or form of materials to make them useful to consumers
What is an example of a business responding to limited capital goods?
If a crucial machine (capital good) is scarce, a business might maintain existing machines, change inventory procedures, or adopt new technology.
What is the difference between an economic want and a non-economic want?
Economic wants are desires for items that can only be obtained by spending money, while non-economic wants are desires that do not require money
What is the Difference Between a Buyer’s and Seller’s Market?
Seller's Market: Demand is high, and supply is low, allowing sellers to charge higher prices.
Buyer's Market: Supply is high, and demand is low, resulting in lower prices for consumers.