Economics

Front 1

Opportunity cost

Back 1

The value of the next best alternative forgone when a decision is made

Hint 1

Decision is made

Front 2

PPF

Back 2

Shows the maximum combinations of goods or services that can be produced in a set period of time given available resources, when all resources are fully employed.

Front 3

Why does a PPF concave to the origin

Back 3

-There isn't a perfect of mobility between the resources (e.g. re-allocating capital and labour resources from 1 industry to another may require retraining, also financial cost of moving resources)
-There's not a perfect factor of substitutabilty between resources (some resources are more useful in one use than another, also increasing marginal rate of substitution)

Hint 3

Finacial and some resources are more in one use than another

Front 4

PPF shifting outwards

Back 4

-Investment (more capital)
-Techological development (better capital)
-Education and training (labour skills)
-Increased labour participation (inventives to work)

Front 5

Points outside the PPF

Back 5

Points outside the curve are not attainable with the current level of resources

Front 6

Points inside the PPF

Back 6

Suggests resources are not being fully utilised

Front 7

What's the PPF useful to demonstrate?

Back 7

Economic growth and oppurtunity cost

Front 8

What does a straight line indicate on a PPF

Back 8

Resources used to produce the two goods are perfectly homogeneous and there's a perfect factor of mobility and constant opportunity cost

Front 9

A skewed line on a PPF suggests?

Back 9

-New tech
-Investment
-Improved production systems

Front 10

Inward shift on a PPF?

Back 10

-War
-Natural disasters
-Complete lack of investment

Front 11

AN ECONOMY'S RESOURCES

Back 11

-Land =natural resources

-Labour = human resources

-Capital = tools and machinery used in the process of making goods/services

-Enterprise = the risk taker, organises the three other factors to create goods/services