The Problem of Scarcity (Grade 10 NSC Matric Economics): Flashcards
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Practise the cards
10 cards from this deck
Scarcity
Scarcity
Core problem driving all economic decision-making
Absolute scarcity
Absolute scarcity
Not enough resources to buy a good, even with money
Relative scarcity
Relative scarcity
Goods exist but people can't afford them due to low income
Free goods
Free goods
Items nature provides without cost (e.g., sunlight, air)
Economic goods
Economic goods
Must be produced using scarce resources, cost money
Opportunity cost
Opportunity cost
Value of next best alternative given up when choosing
Trade-off
Trade-off
Relationship between choices; choosing one means less of another
3 key elements of fundamental economic challenge
3 key elements of fundamental economic challenge
Scarcity, making choices, opportunity costs
Key difference: economic goods vs free goods
Key difference: economic goods vs free goods
Economic goods need scarce resources; free goods are from nature
Who faces opportunity costs?
Who faces opportunity costs?
Everyone: individuals, businesses, and governments