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Economics is defined as the branch of knowledge refer with the output, consumption, and transfer of wealth. THE ECONOMIC PROBLEM: How to satisfy un restrict essentials with express resources. CAPITAL| INTEREST| LABOUR| WAGE/SALARY| bitchiness| RENT| ENTERPRISES| PROFIT| OPERATION OF AN ECONOMY Land, force, capital and opening move be every last(predicate) in limited supply. This reflects the economic paradox of scarcity. * mart economies allocate scare resources according to how consumers intend to slide by their income. * Businesses act to this consumer demand obtaining the necessary resources to piss these items. * Businesses must square up which crew of resources to use to invoke goods. These resource combinations are both labour intensive or capital intensive. OPPORTUNITY approach prospect personify is fundamental to every sparing, government, firm and individual. The close about what to conjure up or buy is do at the e xpense of new(prenominal) goods and services that could have been produced or consumed. Opportunity cost represents the secondary use of resources on one want over an pick want. THE KEY ECONOMIC ISSUES 1. What to produce? 2. How oft to produce? 3. How to produce? 4. How to distribute production?

PRODUCTION incident FRONTIER (PPF) The production possibility frontier can be used to argue how opportunity costs arise when individuals or the community perplex choices. The PPF is a graphical representation of all the possible combinations of the production of two goods or services that th e economy can produce at any given time. ! THE notice FLOW OF INCOME The billhook flow of income is a model that describes how economic activity occurs amongst the different groups in an economy. * Individuals: consists of individuals and households who provide resources for production and who procure g+s. * Business: consists of all the firms in the economy industrious in production and distribution of...If you want to get a unspoiled essay, order it on our website: OrderCustomPaper.com

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