Unit 1

?
Needs
Something essential to survival - food, water, warmth, clothing and shelter
1 of 47
Wants
Something you would like to have, but is not essential to survival - for example cars, mobile phones and chocolate
2 of 47
Resources
Something used to produce output
3 of 47
Labour
Human input into the production process
4 of 47
Land
Land itself and all the natural resources on and below the land for production
5 of 47
Capital
Goods used to produce other goods and services
6 of 47
Enterprise
Having ideas and taking risks in setting up or running a business
7 of 47
Productivity
Output per worker per period of time
8 of 47
Primary
Where extraction of war materials takes place e.g. Mining, farming, fishing
9 of 47
Secondary
Where the raw materials are manufactured into goods e.g. car manufacture, factory
10 of 47
Tertiary
The service sector e.g. banking, tourism, education
11 of 47
Opportunity Cost
The next best alternative forgone when making a choice - what we give up when we make a choice
12 of 47
Market
Where buyers and sellers meet to exchange goods and services. This does not have to mean a face-to-face meeting
13 of 47
Market Economy
Where all resources are allocated by private individuals and groups
14 of 47
Planned economy
Where all resources are allocated by the government
15 of 47
Mixed economy
Where some resources are allocated by the government, and other resources are allocated by private individuals and groups
16 of 47
Public sector
The government sector of the economy, where organisations are owned and run by the government
17 of 47
Private sector
The sector of the economy where firms are owned and run by private individuals and groups - their main aim is profit maximisatino
18 of 47
Surplus
When more is produced than is required. The surplus can be exchanged for money or other goods/services
19 of 47
Competitive market
A market situation in which there are a large number of buyers (demand) and sellers (supply)
20 of 47
Monopoly
A situation where there is only one firm selling in a market. e.g. royal mail
21 of 47
Monopoly power
Where a firm has more than 25% of the market share. e.g. Tesco
22 of 47
Demand
The quantity buyers are willing and able to buy at a given prive in a given period of time
23 of 47
Contraction of demand
the fall in the quantity demanded due to a rise in price
24 of 47
Extension of demand
the increase in quantity demanded due to a fall in price
25 of 47
Inferior goods
Goods for which the demand falls when income rises. e.g. Bus
26 of 47
PED=
percentage change in the quantity demanded/ percentage change in price
27 of 47
Total revenue
The amount of money a firm receives when selling its product. Total revenue = Price x quantity sold
28 of 47
PES=
percentage change in quantity supplied/percentage change in price
29 of 47
Equilibrium
The point where demand and supply meet
30 of 47
Specific tax
A tax placed on a good or service which is a specific amount of money per unit bought
31 of 47
Ad valorem tax
A tax placed on a good or a sevice which is a percentage of the price
32 of 47
Subsidy
A payment given to a firm, usually by the government
33 of 47
Output
The number of goods or services produced by a firm
34 of 47
Fixed costs
Costs that do not vary with output
35 of 47
Variable costs
Costs that vary directly with the output
36 of 47
Profit =
Total revenue - total costs
37 of 47
Merger
agreed coming together of two firms
38 of 47
Takeover
When one firm seeks to take control of another
39 of 47
Integration
This occurs when two firms come together through either a merger or a takeover
40 of 47
Internal economies of scale
When one firm grows in size and so benefits from lower average costs
41 of 47
External economies of scale
When a whole industry grows in size, so a firm within that industry benefits from lower average costs.
42 of 47
Diseconomies of scale
When a firm grows too large and average costs start to rise
43 of 47
Grooss income
Before deductions such as income tax, national insurance and pension
44 of 47
Net income
After deductions. Gross income - deductions
45 of 47
National minimum wage
A pay floor introduced by the government, which sets a wage level below which producers cannot legally go
46 of 47
Specialisation
when a nation or individual concentrates its productive efforts on producing a limited variety of goods
47 of 47

Other cards in this set

Card 2

Front

Something you would like to have, but is not essential to survival - for example cars, mobile phones and chocolate

Back

Wants

Card 3

Front

Something used to produce output

Back

Preview of the back of card 3

Card 4

Front

Human input into the production process

Back

Preview of the back of card 4

Card 5

Front

Land itself and all the natural resources on and below the land for production

Back

Preview of the back of card 5
View more cards

Comments

No comments have yet been made

Similar Economics resources:

See all Economics resources »See all How the market works? resources »