| what are the factors of production | CELL : capital, enterprise, land, labour |
| define opportunity cost: | the next best alternative given up or gone when the best alternative is made. |
| what do we call demand for factors of production | derived demand |
| what are the factor rewards | WRIP: wages, rent, interest, profit |
| what is factor mobility: | factor mobility is the ability to move factors of production out of one production process into another. |
| what is the basic economic problem: | people have unlimited wants but there are limited resources to satisfy these wants. |
| what is utility | satisfaction |
| what are the 2 things that affect market failure? | 1) misallocation of resources.
2) the negative externalities. |
| define market failure | when free markets fail to produce goods and services that are worthwhile, or when the decisions of producers result in wasteful or harmful activities. |
| what are public goods/services: | they are services that benefit all members of society and are often provided for free through public taxation. e.g lamp posts |
| what are merit goods/services: | merit goods are goods that are only given to targeted people, they are not given to the entire society. e.g education, vaccine |
| what are the 2 types of factor mobility? | 1) occupation mobility
2) geographic mobility |
| define occupation mobility: | the ability to move factors between different productive tasks ( more on labour & capital ) |
| define geographic mobility: | the ability to move factors of production between countries. |
| What are consumer goods? | it is an economic good that satisfies an imidiate consumer needs and wants. |
| what is the reward for enterprise? | profit |
| what is the reward for capital? | interest |
| what is the reward for land? | rent |
| what is the reward for labour? | wages |
