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5 Cards in this Set
- Front
- Back
What does resource allocation refer to?
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Resource allocation refers to how much factors of production are used in the production of a particular good/service.
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What is an economic system?
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An economic system refers to how a country can decide what to produce, how a country can produce goods and services and for whom they produce it.
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What is a free market system?
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The free market system is when both producers and consumers determine what and for whom they produce goods
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What is the main aim of entrepreneurs?
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Profit
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Define the price mechanism.
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The price mechanism is the method used by entrepreneurs to decide what to produce. (Using logic: the higher the price, the more we produce)
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