necessary to produce goods and services Natural resources Labor Capital Manufactured goods used to make other goods and services Satisfies wants indirectly Entrepreneurs- individuals who starts a new
business, product, or improve processes
19-1 Key Ideas
Gross Domestic Product- total value of
all final goods and services produced in a country during a single year Intermediate goods are not included
Standard of living- the quality of life
based on the possession of necessities and luxuries that make life easier
19-1 Key Ideas
GDP is only a matter of economic
performance, it does not measure the overall well being of a society
NDP (Net Domestic Product)- takes GDP
and subtracts the total loss in value of capital goods caused by depreciation
19-2 Key Ideas
Market- free and willing exchange of
goods and services
Market systems- flow is circular
19-2 Key Ideas
The consumer sector
Factor markets- the markets where productive resources are bought and sold Consumers earn their income Workers earn wages, salaries, and tips in
exchange for labor
People who own land rent it People that own capital exchange it for interest
19-2 Key Ideas
The Business Sector
Product market- markets where producers offer goods and services for sale Sell goods and services to consumers Businesses use the profit to pay for the
natural resources, labor, and capital they
use
19-2 Key Ideas
The business sector also purchases
some of the output it uses Capital goods- so that it can produce more
goods and services
Tools Factories Etc.
19-2 Key Ideas
The Government Sector
All 3 levels of government Produces goods and purchases productive inputs The government receives revenue from the services it sells Tuition Fees taxes
19-2 Key Ideas
The Foreign Sector
We sell and buy products from foreign
markets
19-2 Key Ideas
Promoting Economic Growth
Economic growth is a major goal of our
economy Improves our standard of living
19-2 Key Ideas
Productivity- measure of the amount of
output produced by a given level of input in a specific time
Specialization- concentrating on goods
and services they can produce better than anyone else
19-2 Key Ideas
Division of labor- breaking down a job
into small tasks performed by different workers
Economic interdependence- we rely on
others and others rely on us to provide goods and services