OCR GCSE Intro to Economics

What are the main economic groups?

1. Households/consumers

2. Businesses/firms

3. Government

4. International sector

What are the factors of production?

1. Land

2. Labor

3. Capital

4. Enterprise

What is the role of the factors of production?

They combine together to make a good/service and generate profit.

What is the basic economic problem?

Resources are scarce, but human wants are unlimited. This leads to the need for efficient resource allocation and decision-making.

What are the three main economic questions?

• What to produce?

• How to produce?

• For whom to produce?

Opportunity cost

Represents the value of the next best alternative foregone when a decision is made, highlighting the trade-offs involved in economic choices.

Trade-off

Involves sacrificing one option for another when making decisions, emphasizing the need to weigh the costs and benefits of different choices.

True or False: Wants are considered first when making economic decisions.

False: Needs are considered first when making economic decisions.

True or False: Economic decisions are made in all levels of society.

True

True or False: The factors of production never combine together.

False: The factors of production do combine together in order to make a good/service and generate profit.