the economic problem
- Created by: Emilysh02
- Created on: 05-06-19 14:15
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- the economic problem
- 'how to best satisfy infinite desires using limited resources'
- everyone has their basic needs and everyone also has an infinite list of things they want.
- there are four factors of production
- land
- including all natural resources in and on it.
- labour
- the work done by the people
- capital
- equipment used in producing goods and services
- enterprise
- willingness to take a risk to make a profit.
- land
- economic agents react to incentives
- economic agents:
- producers
- consumers
- governments
- economic agents:
- scarcity requires the careful allocation of resources
- in economics a wide range of things count as economic activity
- one form of economic activity is the making of goods and the provision of services
- goods: 'physical' products you can touch
- services: 'intangible' things
- another form of economic activity is consumption
- 'how to best satisfy infinite desires using limited resources'
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