economcis 2
why is economics a social science?
it is the study of how society interacts with itself and makes decisions
what is a need
something humans require to survive
what is a want
something that is not required to survive but improves the standard of living
what are factors of production
cell
what is captial
manmade equipment that uses the production of other goods and services
what is enterprise
the individuals who make decisions and take risks
what is land
the raw materials available
what is labour
the workforce
what is economic welfare
the standard of living within a society
what is the basic economic problem
resources are limited and wants are unlimited
what is an opportunity cost
the next best alternative that you miss out on
what is a normative statement
an opinion that carries a value judgement
what is a positive statment
a statement that is capable of being tested against the facts
what is demand
the quanitity of goods and services desired by customers who have the ability to afford them
why does the demand curve slope from left to right
customers reduce their demand as the price rises
what does price do to the demand curve
creates a movement
what is production efficiency
you cannot produce more of one good without sacrificing another
what is allocative efficiency
the point on the ppb that offers the best comnbination of production of goods and services
what is supply
the willingness to produce goods and services with a profit incentive
what is market equilibrium
when demand equals supply in a market
what is market clearing price
when the products that are presented to the market are sold and the market is cleared
what does a shift to the right mean in the supply curve
factor increases
what does a shift to the left mean in the supply curve
factor decreases
give 3 things that will cause a shift in the supply
staff shortages, technological advancements, availablity of resources
give 3 things that will cause a shift in the demnad curve
seaonality, uncertainty of future prices,changes in income