Exam #1 Cheat Sheet - 4 basic economic resources: labor,...

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
4 basic economic resources: labor, natural resource, capital goods, and entrepreneurial skills. Scarce economic resources – even when resources are fully employed & used efficiently, not enough will be produced to satisfy the wants of people & institutions. Natural resources as a type of economic resource – whatever nature had provided that is usable in production (land suitable for farming, forests, oil, mineral deposits, etc.) Capital goods – manufactured aids to production Productive efficiency : produce goods/ services in least costly way. Allocative efficiency : produce goods/services that people most need/want. *By reducing unemployment or by reducing inefficiency, it is possible to simultaneously increase output of both capital goods and consumer goods. Production Possibilities Curve (PPC): any point outside the PPC is impossible to reach. PPC is always drawn assuming full employment, productive efficiency, and existing levels of capital goods and technology. Simple production : output such that the economy will have the same production possibilities next year as it has this year. Ceteris paribus
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 03/17/2008 for the course ECON 002 taught by Professor Mcleod,markpehlivan,ayseozg during the Fall '08 term at Pennsylvania State University, University Park.

Page1 / 2

Exam #1 Cheat Sheet - 4 basic economic resources: labor,...

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online