Economic Definitions

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Basic economic problem
Resources have to be allocated between competing uses because wants are infinite whilst resources are scarce.
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Choice
Economic choice involves the alternative uses of scarce resources
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Economic goods
Good which are scarce because their use has an opportunity cost.
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Free goods
Goods which are unlimited in supply and therefore have no opportunity cost.
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Needs
The minimum which is necessary for a person to survive as a human being.
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Opportunity cost
The cost of the next best alternative foregone.
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Production possibility curve (PPC/PPF)
A curve which shows the maximum potential level of output of one good given a level of output for all other goods in the economy.
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Card 2

Front

Economic choice involves the alternative uses of scarce resources

Back

Choice

Card 3

Front

Good which are scarce because their use has an opportunity cost.

Back

Preview of the back of card 3

Card 4

Front

Goods which are unlimited in supply and therefore have no opportunity cost.

Back

Preview of the back of card 4

Card 5

Front

The minimum which is necessary for a person to survive as a human being.

Back

Preview of the back of card 5
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