Economic notes

What are needs? Basic requirement for human survival

What are wants? Peoples desire for goods and services

Ex - food - burger , pasta

Shelter - house , bungalow , hotel

What is the cause for basic economical problem ?

Because resources are limited / or scare in nature compared to unlimited (infinite ) wants .

1. What to produce
2. How to produce
3. For whom to produce ? (problem of distribution )

What is choice ?
Deciding what to choose among alternative scare resources

What are capital goods?

Good used to produce another good (have future benefits ) ex - road , highway , railway

What are consumer goods?

Good used for present consumption , purchased by households . ex - food , medicine

What is a ppc (production possibility curve or frontier )

It is a curve that shows maximum possible output of 2 combinations of goods , while using all
resources .

What are the reasons for economic growth ?

- New technology
- Increasing efficiency
- Education and training
- New resources

What are the factors of production

1.land
2.labour
3. Capital
 4. Entrepreneur

Entrepreneur - bears risk , organizes , innovative , and the decision maker

What is an economical good ?

A good that is scare (limited )
Have alternative user
Ex free education , cars , land , labour , capital , entrepreneur

What is non economical good / free good ?

Unlimited in nature , gifts of nature ex - air , sunlight , water from rain