Economics, unit 1, AQA, market failure, the economic problem, goods and services, costs, production, opportunity cost

Well explained resource for UNIT 1. If you would like me to include anything extra for this particular topic, please comment :)

Subjects:

Scarce resources

Opportunity costs

Objectives

PPF curve

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  • Created by: Nikorasu
  • Created on: 06-02-13 17:46

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Page 1

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The economic problem

The purpose of economic activity and the issue of scarcity

The fundamental economic problem is that consumers (or informally us) have infinite wants in
relation to the limited resources we can use. I.e. Only a limited amount of resources are
available to produce the unlimited quantity of…

Page 2

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Trading off between these different objectives

Understandably, it is difficult to chose between different outcomes that all have advantages
and disadvantages.
It, however, may be possible to resolve the conflict by trading off between the alternatives.
(as shown in my previous diagram)
Where the production of capital goods can be…

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