economy first test

PMO

goods

tangible products that are produced, bought, sold, and consumed.

services

activities that other people do for you

needs

what humans need for basic survival

economic good

goods scarce relative to their demands, and therefore requires a sacrifice to get

free good

A good that is abundant and available without cost, being able to satisfy the demand for them.

Land

natural resources provided by nature

Labour

physical and mental efforts of people needed to make products and provide services

Capital

man-made goods used to make other goods such as machinary

Enterprise

The ability of the person who brings the other resources of factors of production together to produce a good or a service

Rent

factor income/rewards of land

Wages

factor income/rewards of labour

Interest

factor income/rewards of capital

profit

factor income/rewards of enterprise

opportunity cost

the benefit of the next best alternative forgone

production possibility curve

A curve showing the maximum combination of two goods which can be produced using a fixed amount of resources

consumer goods

products purchased by individuals and households for personal use, not for further production

capital goods

physical assets like machinery and equipment that businesses use to produce other goods and services