Basic Econ Problem
Refers to the economic problem of having limited resources with unlimited wants
What is scarcity
What is demand?
Willingness and ability to buy
Who decides what to produce in a market economy?
Consumers and producers
What function of money allows buying and selling?
Medium of exchange
Where Ms Tamer is From?
Kyrgyzstan
4 Factors of Production
Land, labour, capital, enterprise
What happens to demand when price rises?
Quantity demanded falls
What is a mixed economy?
An economy with both private and government sectors
What function lets us compare prices?
Unit of account
Name HK's famous payment card used for transport and shopping.
Octopus
What causes the basic economic problem?
Unlimited wants and limited resources
Name one factor shifting demand.
Income, tastes, advertising, population, etc.
What is market failure?
When markets fail to allocate resources efficiently
What function allows money to be saved?
Store of value
HKD is linked to which currency ?
USD
What is opportunity cost?
The next best alternative forgone
PED = 2. Is demand elastic or inelastic?
Elastic
Name one cause of market failure.
Externalities, public goods, imperfect information, etc.
Name one property of good money.
Durable / portable / divisible / acceptable
HK's main trading partner
China
A government spends more on hospitals. What is the opportunity cost?
Other goods/services that could have been produced
PED = 0.3. Price rises by 10%. What happens to quantity demanded?
Falls by 3%
Why might the government provide public goods?
Because private firms may not provide enough due to the free-rider problem
Currency of Kyrgyzstan
Kyrgyzstani Soms
Guess Ms Tamer's height in CM
168 CM