
CFOI, Business cycle, indicators, Monetary, Fiscal
Flashcard
•
Financial Education
•
10th Grade
•
Easy
Tobias Hua
Used 7+ times
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56 questions
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1.
FLASHCARD QUESTION
Front
The Circular Flow of Income
Back
a simplified model of the economy enabling economists to identify solutions to problems in the business cycle (level of economic activity)
2.
FLASHCARD QUESTION
Front
What does The Circular Flow of Income show?
Back
It shows the connections between the 5 different sectors of an economy: household, firms, financial, gov, overseas
It shows where money is being injected and leaked from the economy
3.
FLASHCARD QUESTION
Front
What is the economic problem?
Back
Our human wants significantly outweigh the resources available. Human wants are unlimited, while natural resources are limited and finite.
4.
FLASHCARD QUESTION
Front
Scarcity
Market
Back
the excess of human wants over what can actually be provided and produced
where limited resources are allocated and exchanged between buyers and sellers
5.
FLASHCARD QUESTION
Front
What are the factors of production?
Back
Economic resources needed for the creation of goods and services
6.
FLASHCARD QUESTION
Front
List the factors of production with detail, and their income return
Back
Land - any type of land (agricultural, commercial real estate etc) and all natural resources (minerals, water, forests etc) Factor income return: rent
Labour - the effort, time and skills expended by individuals to produce goods and services
Factor income return: wages
Capital - produced assets created or acquired used to make goods and services (tools, machinery, technology etc. Factor income return: interest
Enterprise - the ability of people to take financial risks and organise the other factors of production into a unit capable of producing goods and services. Factor income return: profit
7.
FLASHCARD QUESTION
Front
Explain the 2 sector model by defining both and explaining the process
Back
Household sector - comprised of consumers who own economic resources
Firm sector - banks, businesses and organisations
Households sell their economic resources to firms
Firms pay income for these resources
Firms use these resources to produce goods and services for household
Household use their income to buy/consume goods and services provided by firms
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