Studied by 23 people
scarce resources
when there is an insufficient amount of something to satisfy all wants
opportunity cost
the next best alternative given up when making a choice
unlimited wants
the infinite desire for something
economic sustainability
the best use of resources in order to create responsible development or growth, now and into the future
social sustainability
the impact of development or growth that promotes an improvement in quality of life for all, now and into the future
environmental sustainability
the impact of development or growth where the effect on the environment is small and possible to manage, now and into the future
primary sector
the direct use of natural resources, such as the extraction of basic materials and goods from the land and sea
secondary sector
all activities in an economy are concerned with either manufacturing or construction
tertiary sector
all activities in an economy that involved the idea of a service
factor market
market in which the services of the factors of production are bought and sold
product market
market in which final goods or services are offered to consumers, businesses and the public sector
specialisation
the process by which individuals, firms, regions and whole economies concentrate on producing those products that they are best at
division of labour
where workers specialise in or concentrate on one area of the production process
demand
the willingness and ability to purchase a good or service at the given price in a given time period
supply
the willingness and ability of firms to produce goods and services at each price in a given period of time
subsidy
an amount of money the government gives directly to firms to encourage production and consumption
tax
a compulsory payment to the government
elastic demand
when the percentage change in quantity demanded is greater than the percentage change in price
inelastic demand
when the percentage change in quantity demanded is smaller than the percentage change in price
price elasticity of demand
the responsiveness of quantity demanded to a change in the price of the product
elastic supply
when the percentage change in quantity supplied is greater than the percentage change in price
inelastic supply
when the percentage change in quantity supplied is smaller than the percentage change in price
price elasticity of supply
the responsiveness of quantity supplied to a change in the price of a product
price
the sun of money you have to pay for a good or service. it is determined by the interaction of supply and dem
efficiency
the optimal production and distribution of scarce resources
competition
where different firms are trying to sell a similar product to a consumer
monopoly
a sole producer or seller of a good or service
oligopoly
where a small number of firms control the large majority of market share
profit
the amount of money a producer has left after all costs have been paid i.e. when total revenue is greater than total costs
productivity
one measure of the degree of efficient in the use of factors of production. it is measure in terms of output per unit of input
average cost
the cost of producing a unit
total revenue
the total income of a firm from the scale of its good and services
average revenue
the revenue per unit sold
loss
when a firms revenue is less than its total costs
economies of scale
the cost advantages a firm can gain by increasing the scale of production, leading to a fall in average costs
labour market
where workers sell their labour and employers buy the labour. it consists of households’ supply of labour and firms’ demand for labour
supply of labour
the total number of people willing and eligible to supply their labour, including the unemployed
gross pay
the amount of money that an employee earns before any deductions are made
income tax
a tax levied directly on personal income i.e a tax on persons wages
national insurance
a contribution paid by workers and their employers towards the cost of state benefits
net pay
the amount of money that an employee is left with after deductions are made from gross income
pension
a fixed amount paid at regular intervals to a person, or their surviving dependents
money
anything that is generally accepted as a means of payment for goods and services, medium of exchange
financial sector
consists of financial organisations and their products, and involves the flow of capital
investment
the purchase of capital goods that are used to produce future goods and services. also, an asset purchased to provide an income in the future and/or to be sold at a profit
rate of interest
the cost of borrowing i.e that which is paid to the lender. the reward for saving
building society
a mutual financial institution that is owned by its members. its primary objectives are to receive deposits from its members and to lend money for members to purchase property
mortgage
an agreement with a financial institution to borrow money to purchase a property
insurance company
financial institutions that guarantees compensation for specified loss, damage, illness or death in return for an agreed premium
capital
the factor of production that related to the human-made aids to production
collective bargaining
negotiations between a recognised trade union and employers
consumer
a person or organisation that directly uses a good or service
excess demand
where, at the current price, the amount demanded is greater than the amount sellers are willing to supply
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