a statement of fact that can be scientifically tested to see if it is correct or incorrect
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normative statement
a statement that includes a value judgement and cannot be refuted just by looking at the evidence
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need
something that is necessary for human survival, such as food, clothing, warmth or shelter
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want
something that is desirable, such as fashionable clothing, but is not necessary for human survival
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economic welfare
the economic well-being of an individual, a group within society or an economy
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production
a process, or set of processes, that converts inputs into output of goods
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capital good
a good which is used in the production of other goods or services
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consumer good
a good which is consumed by individuals or households to satisfy their needs or wants
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factors of production
inputs into the production process, such as land, labour, capital and enterprise
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finite resources
a resource, such as oil, which is scarce and runs out as it is used
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renewable resources
a resource, such as timber, that with careful management can be renewed as it is used
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fundamental economic problem
how best to make decisions about the allocation of scarce resources among competing uses so as to improve and maximize human happiness and welfare
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scarcity
results from the fact that people have unlimited wants but resources to meet these wants are limited
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opportunity costs
the cost of giving up the next best alternative
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production possibility frontier
a curve depicting the various combinations of two products that can be produced when all the available resources are fully and efficiently employed
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economic growth
the increase in the potential level of real output the economy can produce over a period of time
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full employment
when all who are able and willing to work are employed
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unemployment
when not all of those who are able and willing to work are employed
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choice
choosing between alternatives when making a decision on how to use scarce resources
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resource allocation
the process through which the available factors of production are assigned to produce different goods and services
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productive efficiency
for the economy as a whole occurs when it is impossible to produce more of one good without producing less of another
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allocative efficiency
occurs when the available economic resources are used to produce the combination of goods and services that best matches people's tastes and preferences
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Other cards in this set
Card 2
Front
a statement that includes a value judgement and cannot be refuted just by looking at the evidence
Back
normative statement
Card 3
Front
something that is necessary for human survival, such as food, clothing, warmth or shelter
Back
Card 4
Front
something that is desirable, such as fashionable clothing, but is not necessary for human survival
Back
Card 5
Front
the economic well-being of an individual, a group within society or an economy
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