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28 Cards in this Set
- Front
- Back
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Economic Resources
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All natural, human and manufactured resources.
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Land
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includes ALL natural resources; it is used in the production of goods and services; arable land, forests, minerals, oil, water, etc.
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Capital
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Investment goods; all manufacturing aids used in producing consumer goods and services. Tools, machinery, equipment, factories, storage, transportation, and distribution facilities.
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Investment
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The process of purchasing capital goods.
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Labor
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A broad term fro all the physical and mental talents of individuals available and usable in producing goods and services.
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Entreprenurial Ability
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A special resource; a person who take the initiative, makes strategic business decisions, innovates, and risk bearer.
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The Factors of Economic Production (memory key)
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LLCE (Land, Labor, Capital, Etreprenurial Ability)
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full employment
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The use of all available resources
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full production
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all employed resources must be used so that they provide the maximum possible satisfaction of economic wants.
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allocative efficiency
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The least-cost production of that particular mix of goods and services wanted by society.
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productive efficiency
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The production of any particular mix of goods and services in the least costly way.
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fixed resources
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The available supplies of the factors of production are fixed in both quantity and quality.
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fixed technology
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The state of technology, does not changed during analysis.
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two goods
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The concept that the economy is only producing tow goods. Consumer goods and capital goods.
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Production Possibilites Table
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It lists the different combinations of two products that can be produced with a specific set of resources.
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Assumptions of the Production Possibilities Table
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Full Employmnet and productive efficiency, Fixed resources, Fixed Technology, Two Goods
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Production Possibilities Curve
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A production "frontier" showing the limits of attainable outputs.
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Opportunity Costs
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The amount of other products that must be forgone to obtain 1 unit of a specific good.
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Law of Increasing Opportunity Costs
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The more of a product that is produced, the greater is its opportunity cost(marginal being implied)
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economic growth
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The ability to produce a larger total output.
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economic system
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A particular set of institutional arrangements and a coordinating mechanism.
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consumer goods
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products that satisfy our wants directly
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capital goods
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products that satisfy our wants indirectly by producing consumer goods efficiently. IE(robots, factories, tools, etc)
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market system (capitalism)
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The private ownership of resources and the uses of markets and prices to coordinate and direct economic activity.
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command system (socialism/communism)
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The govt. owns most property resources and economic decisions occur through a central economic plan.
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resource market
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The place where resources or the services of resources suppliers are bought and sold.
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product market
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The place where goods and services produced by businesses are bought and sold.
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circular flow model
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suggests a complex, interested web of decision making and economic activity involving businesses and households.
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