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Questions and Answers
What is a need?
A good or service essential for living.
What is a want?
A good or service which people would like to have but which is not essential for living.
What does the economic problem refer to?
It results from unlimited wants but limited resources.
What are factors of production?
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What is scarcity?
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What is opportunity cost?
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What is division of labor?
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What do businesses do?
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What are business objectives?
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What is value added?
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What is a stakeholder?
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What is the primary sector?
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What is the secondary sector?
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What is the tertiary sector?
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What does de-industrialization refer to?
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Study Notes
Basic Economic Concepts
- Needs are essential for survival, while wants are desired but not essential. Wants are unlimited.
- The Economic Problem arises from unlimited wants and limited resources, leading to scarcity.
- Factors of Production are resources used for production and are in limited supply. These include land, labor, capital and enterprise.
- Scarcity means there aren't enough goods and services to satisfy everyone's wants.
- Opportunity Cost is the value of the best alternative forgone when making a choice.
Business Operations
- Businesses combine factors of production to produce goods and services that satisfy wants.
- Business Objectives are goals that businesses aim to achieve.
- Value Added is the difference between a product's selling price and the cost of materials and components. This represents the value a business contributes to the product.
- Stakeholders are individuals or groups with a direct interest in the business's activities and performance.
Sectors of the Economy
- The Primary Sector extracts and utilizes Earth's natural resources.
- The Secondary Sector manufactures goods using raw materials from the primary sector.
- The Tertiary Sector provides services to consumers and other sectors.
- De-industrialization is a decline in the importance of the secondary sector in a country's economy.
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Description
This quiz covers fundamental economic concepts such as needs, wants, scarcity, and opportunity cost, along with key business operations. It explores how businesses utilize factors of production to achieve their objectives and the role of stakeholders. Test your knowledge of these essential principles in economics and business.
