AQA ECONOMICS COMPREHENSIVE
MICROECONOMICS AND
MACROECONOMICS REVIEW SHEET FULL
SOLUTIONS
●● Normative Statement
Answer: a statement that is subjective as it includes a value judgement,
therefore not possible to test as it is based on opinion
●● Need
Answer: something that is necessary for human survival, such as food,
clothing, warmth or shelter
●● Want
Answer: something that is desirable such as fashionable clothing, but is
not necessary for human survival
●● The basic economic problem
Answer: There are a limited amount of resources to fulfil our infinite
number of wants
●● Economic Welfare
,Answer: the economic well-being of an individual, a group within
society, or an economy. It is maximised when scarce resources are
allocated efficiently in economic activity to produce a good people
want/need
●● Production
Answer: a process, or set of processes, that converts inputs into outputs
of goods
●● Capital Good
Answer: a good which is used in the production of other goods or
services. Also known as a producer good
●● Consumer Good
Answer: a good which is consumed by individuals or households to
satisfy their needs or wants
●● Factors of Production
Answer: inputs into the production process, such as land, labour, capital
and enterprise
●● Finite Resource
Answer: a resource, such as oil, which is scarce and runs out as it is
used. Also known as a non-renewable resource
, ●● Renewable Resource
Answer: a resource, such as timber, that with careful management can be
renewed as it is used
●● Fundamental Economic Problem
Answer: how best to make decisions about the allocation of scarce
resources among competing uses so as to improve and maximise human
happiness and welfare
●● Scarcity
Answer: results from the fact that people have unlimited wants but
resources to meet these wants are limited. In essence, people would like
to consume more goods and services than the economy is able to
produce with its limited resources
●● Opportunity Cost
Answer: is the cost be the next best alternative foregone when a decision
is made
●● Production Possibility Curve (PPC)
Answer: combinations of two products (or types of product) that can be
produced when all the available resources are fully and efficiently
employed
MICROECONOMICS AND
MACROECONOMICS REVIEW SHEET FULL
SOLUTIONS
●● Normative Statement
Answer: a statement that is subjective as it includes a value judgement,
therefore not possible to test as it is based on opinion
●● Need
Answer: something that is necessary for human survival, such as food,
clothing, warmth or shelter
●● Want
Answer: something that is desirable such as fashionable clothing, but is
not necessary for human survival
●● The basic economic problem
Answer: There are a limited amount of resources to fulfil our infinite
number of wants
●● Economic Welfare
,Answer: the economic well-being of an individual, a group within
society, or an economy. It is maximised when scarce resources are
allocated efficiently in economic activity to produce a good people
want/need
●● Production
Answer: a process, or set of processes, that converts inputs into outputs
of goods
●● Capital Good
Answer: a good which is used in the production of other goods or
services. Also known as a producer good
●● Consumer Good
Answer: a good which is consumed by individuals or households to
satisfy their needs or wants
●● Factors of Production
Answer: inputs into the production process, such as land, labour, capital
and enterprise
●● Finite Resource
Answer: a resource, such as oil, which is scarce and runs out as it is
used. Also known as a non-renewable resource
, ●● Renewable Resource
Answer: a resource, such as timber, that with careful management can be
renewed as it is used
●● Fundamental Economic Problem
Answer: how best to make decisions about the allocation of scarce
resources among competing uses so as to improve and maximise human
happiness and welfare
●● Scarcity
Answer: results from the fact that people have unlimited wants but
resources to meet these wants are limited. In essence, people would like
to consume more goods and services than the economy is able to
produce with its limited resources
●● Opportunity Cost
Answer: is the cost be the next best alternative foregone when a decision
is made
●● Production Possibility Curve (PPC)
Answer: combinations of two products (or types of product) that can be
produced when all the available resources are fully and efficiently
employed
