The difference between goods and services is that goods are tangible products, and services are intangible products.

A need is a good or service essential for living.

A want is a good or service that is desired by consumers, but is not necessary or essential for living.

The economic problem is scarcity.

Scarcity is caused by unlimited wants in relation to the limited factors of production.

Scarcity is a shortage of goods or services.

The factors of production are the resources required to produce goods and services.

The four factors of production are land, labor, capital, and enterprise.

Land refers to natural resources provided by nature such as minerals, oils, and forests.

Labor refers to the efforts of workers required for production.

Capital refers to the finance, machinery, and equipment necessary for the manufacture of products.

Enterprise is the skill and risk-taking ability of an entrepreneur to combine the factors of production in order to produce goods or services.

An entrepreneur is an individual possessing the risk-taking ability to combine the factors of production in order to produce good or services.

An opportunity cost is the next best alternative forgone by choosing another option or item.

Specialisation occurs when people or businesses concentrate on the skills they are good at.