BUSINESS-ECONOMICS-YEAR 10-NOTES AND DEFINITIONS
Economics- The study of choice and how/ why individuals/ governments/
businesses make decisions.
Scarcity- Unlimited wants but limited resources.
Opportunity Cost- The thing you give up to do another thing. Eg: Amy decides to go
to the gym instead of shopping. She gave up shopping, so shopping is her
opportunity cost.
Goods vs. Services- A good is a tangible, physical item that you can touch. Eg:
shoes, pens. A service is an action, or work you do for another person. Eg:
plumbing, educating.
Factors of Production-
1. Land: Natural resources.
2. Labour: Human effort.
3. Capital: Man-made resources (machinery).
4. Enterprise: Skills to combine the other three, like an idea from an entrepreneur.
Stages of Production-
1. Primary - extracting raw materials. Eg: strawberry farm
2. Secondary - manufacturing and processing
3. Tertiary - service industry or selling goods. Eg: a bank or school
Organisations-
Private: Owned by individuals for profit.
Public: Government-owned for public service.
Voluntary: Non-profits and charities.
Law of Demand- As price increases, quantity demanded decreases (Price goes up,
demand goes down). Because people have fixed incomes.
Law of Supply- As price increases, quantity supplied increases (Price goes up, supply
goes up). Because businesses can profit.
Equilibrium- The point where quantity demanded exactly matches quantity supplied
(no shortage or surplus).
Economics- The study of choice and how/ why individuals/ governments/
businesses make decisions.
Scarcity- Unlimited wants but limited resources.
Opportunity Cost- The thing you give up to do another thing. Eg: Amy decides to go
to the gym instead of shopping. She gave up shopping, so shopping is her
opportunity cost.
Goods vs. Services- A good is a tangible, physical item that you can touch. Eg:
shoes, pens. A service is an action, or work you do for another person. Eg:
plumbing, educating.
Factors of Production-
1. Land: Natural resources.
2. Labour: Human effort.
3. Capital: Man-made resources (machinery).
4. Enterprise: Skills to combine the other three, like an idea from an entrepreneur.
Stages of Production-
1. Primary - extracting raw materials. Eg: strawberry farm
2. Secondary - manufacturing and processing
3. Tertiary - service industry or selling goods. Eg: a bank or school
Organisations-
Private: Owned by individuals for profit.
Public: Government-owned for public service.
Voluntary: Non-profits and charities.
Law of Demand- As price increases, quantity demanded decreases (Price goes up,
demand goes down). Because people have fixed incomes.
Law of Supply- As price increases, quantity supplied increases (Price goes up, supply
goes up). Because businesses can profit.
Equilibrium- The point where quantity demanded exactly matches quantity supplied
(no shortage or surplus).
