CHAPTER1: BASIC ECONOMIC IDEA(CORE)

LIMITED RESOURCES

LAND

- is a natural resource
- mineral deposits below the earth and climate above
- also include the surface of the earth, lakes, rivers and forest

LABOUR

- is human resources, the basic determinant of which is the nation’s population

- not all the population is available to work because some are above or below the working
age or some choose to not to work

CAPITAL

- is any-man aid to production.

- Include a simple spade and complex car assembly plant
- Help land and labour produce more units of output-they improve the output from land
and labour.

ENTERPRISE

- Carries out two function.

- Firstly, enterprise factor organises the other three factor of production.
- Secondly, enterprise involving taking the risk of production, which exist in a free
enterprise company.
- The functions of enterprise are undertaken by a single individual, the entrepreneur.
- In larger, more complex firms the functions are divided, with salaried managers
orginising the other factors and shareholders taking the risk.

PRODUCTION AND COMSUMPTION

- Resource are combined in the process of production to create goods and services.
 - The process through which individuals use up good and services satisfy wants is known
as consumption.
- Some of the good are quickly used up to satisfy our wants and other thing satisfy wants
over a longer period.
- Those are consumer durable
- Eg: television sets, refrigerators and vehicle.

UNLIMITED WANTS