Economics AS unit 1 Revision

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scarcity/opportunity cost

  • scarcity is the basic economic problem 
  • scarcity is the result of insufficient resources required to provide for everyone
  • scarcity exists because human wants = infinite , whereas resources required to meet those wants = finite
  • Scarcity occur in all sorts of economies , but it is more obvious in countries that face : famine/drought and insufficient food/water
  • it can also occur in wealthy($$$) countries as not all human material wants can be "satisfied"
  • scarcity will mean we have to make important decisons and this situation 
  • cosnumers , producers , goverment : all face scarcity
  • once we make the decision - "oppurtunity cost" arises
  • oppurtunity cost = "value of the next best alternative forgone"
  • cosnumers , producers , goverment : all face oppurtunity cost
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Renewable and Non- Renewable resource

  • Renewable resource : is one whose stock level can be maintained over a period of time
  • Examples of renewable resources : soalr energy , windpower , water , oxygen , timber , soil
  • Renewable resource may decline if it is cosumed at a faster rate than the enviroment can replenish (Restore) them
  • In order to avoid things such as "deforestation" and "soil erosion" - caful management is required
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  • Non-Renewable resources :is one whose stock level decreases over a period of time as it is consumed
  • Examples of Non-renewable resources : fossil fuels such as (coal,oil and gas ) + commodities such as steel , copper , aluminium
  • The rate of decline of non-renewable resources can be reduced through : 
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