Macroeconomics unit 1 study guide basic economic concepts

Capital - all manufactured aids to production tools, machinery, equipment, and factory, storage, transportation, and distribution facilities used in producing goods and services. Labor - physical and mental talents of individuals available and usable in producing goods and services. Entrepreneurial ability - the entrepreneur 1 takes the initiative in combining the other resources to produce a good or service. Production Possibilities Curve.

Scarcity is the basic problem in economics in which society does not have enough resources to produce whatever everyone needs and wants. Basically, it is unlimited wants and needs vs. Scarcity is faced by all societies and economic systems. Since we are faced with scarcity , we must make choices about how to allocate and use scarce resources. Economics is the study of how individuals, firms, and governments deal with scarcity. As a result of facing scarcity , all members of a society have to make choices in an effort to manage our resources in the most efficient way possible.

Macroeconomics unit 1 study guide basic economic concepts

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She wants to spend next Saturday afternoon attending a sporting event. E money spent on clothing expenses.

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All Subjects. AP Microeconomics. Unit 1 — Basic Economic Concepts. Unit 1: Basic Economic Concepts. Scarcity is the basic problem in economics in which society does not have enough resources to produce whatever everyone needs and wants. Basically, it is unlimited wants and needs vs. Scarcity is faced by all societies and economic systems. Since we are faced with scarcity , we must make choices about how to allocate and use scarce resources. Economics is the study of how individuals, firms, and governments deal with scarcity.

Macroeconomics unit 1 study guide basic economic concepts

If you're seeing this message, it means we're having trouble loading external resources on our website. To log in and use all the features of Khan Academy, please enable JavaScript in your browser. Donate Log in Sign up Search for courses, skills, and videos. Unit 1. Unit 2. Unit 3. Unit 4. Unit 5.

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Course Feedback Survey. If a country produces more capital goods than consumer goods, the country will have greater economic growth in the future. Output problems focus on data associated with what each party can produce with a given set of resources and who should specialize in each good. Competition keeps both the costs of production and the prices of goods and services low. Shifts in this curve can be caused by increases in resource supplies or advances in technology. Mark as completed. This is the value of the next best alternative. Saylor Direct Credit. The advantages of this type of economic system are that it has the advantages of a market economy, including being able to distribute goods and services to where they are most needed, and it allows prices to measure supply and demand. What would be the combination of packs of pencils and composition books she could purchase in order to maximize her utility?

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Microeconomics vs. In a mixed economy, private property rights are protected and there is a certain level of economic freedom, but the government is also allowed to intervene in an effort to meet societal aims. The central planning aspect could also create some problems depending on the degree of government involvement. It is a frontier because it shows the limit of output. Economic efficiency - achieve the maximum production using available resources 4. Land - all natural resources usable in the production process Capital - all manufactured aids to production tools, machinery, equipment, and factory, storage, transportation, and distribution facilities used in producing goods and services Labor - physical and mental talents of individuals available and usable in producing goods and services Entrepreneurial ability - the entrepreneur 1 takes the initiative in combining the other resources to produce a good or service. Economic resources - the means of producing goods and services-are limited or scarce. Economic contraction is shown by a leftward shift of the production possibilities curve. Point G represents a production level that is unattainable. To determine absolute advantage , you are looking for the country that uses the least amount of resources i. Unit 3: Aggregate Demand and Aggregate Supply. Donna spent all of his allocated budget on buckets of popcorn and large sodas at the movies.