✨Economics EOT definitions✨

What is economics?

Economics is a social science which studies the behaviour and decisions made by people in relation to how scarce resources are used to satisfy needs and wants.

What is microeconomics?

Microeconomics is a branch of economics that analizes the market behaviour of individual consumers and firms in an attempt to understand the decision making process of firms and households

What is macroeconomics?

Macroeconomics is a branch of economics that studies the behaviour and performance of the economy as a whole. It focuses on the aggrigate(total) changes in the economy such as unemployment, growth rate, GDP and inflation

What are resources?

Resources refer to all the inputs used in the production of goods and the provision of services

What are natural resources?

Natural resources refer to resources which are drawn from nature

What are man made resources?

Man made resources refer to resources that are artificially made and made by man

What are goods?

Goods are tangible items, meaning that they can be physically touched

What are services?

Services are intangible, meaning that they can’t be physically touched.

What is scarcity?

Scarcity is the economic condition in which all resources, goods and services may be plentiful but are not sufficient for all those who desire them

What is choice?

Choice refers to the range of options available to the individual, households, firm or government

What is opportunity cost?

Opportunity cost is the value of what you give up when you choose one thing over another. It is the next best alternative foregone.

What is a PPT?

A PPT is a table that lists the different combinations of 2 products which can be produced with a specific set of resources

What is a PPC?

A PPC is a graph that shows the maximum combination of two goods that an economy can produce, given the quantity of resources and the level of technology at that point in time.

What is efficiency?

Efficiency is the optimum utilization of resources.

What is inefficiency?

Inefficiency implies that resources are not being used to their full capacity

What is a pivot?

A pivot is a diagram which shows the change in how much of one good can be made while still making the same amount of the other good.

What is an economy?

An economy is a mechanism through which scare resources are organized for the production of goods and services

What is economic activity?

Economic activity refers to the production and consumption of goods and services

What is money cost?

Money cost refers to what was paid for the inputs used to produce a good/service

What are economic decisions?

Economic decisions refer to when an individual is faced with options and chooses one course of action

What is production?

Production can be defined as the conversion of factors of production into goods and services that consumers wish to consume.

What are producer goods?

Producer goods are goods such as machinery that help in the production of other goods and services

What are intermediate goods?

Intermediate goods are goods that are used as input in the production of other goods and services

What are final goods?

Final goods refer to the goods that are bought by consumer for usage

What is land?

Land refers to all the free gifts of nature that provide all the raw materials used to provide goods and services

What is labour?

Labour refers to the actual effort both physical and mental made by human beings in production

What is efficiency of labour?

Efficiency of labour refers to the ability of labour to produce a higher level of output without a drop in the standard of work

What is capital?

Capital refers to the physical assets or any man made goods which are used during production

What is an entrepreneur?

An entrepreneur is a person who brings together the various factors of production, plans and organizes the qualities of land, labour and capital used in the production of goods and services and decides on the types of goods to produce, how to produce them and how much to produce

What is productivity?

Productivity is a measure of output per unit of input