This will be an extremely useful guide for students who are going to sit for the AS examination in October/ November examination:
1. Adam
Smith: One of the founding fathers of Economics and the author of the famous
book, The Wealth of Nations
2. Barter:
The act of trading goods and services without the use of money
3. Capital:
The factor of production which includes man-made products which assist in the
production process
4. Ceteris
paribus: a Latin term which literally means ‘holding other factors constant’
5. Cheques:
A method of payment in which money is transferred from one individual’s account
to another (it is not a form of money as what students usually thought)
6. Command
economy (planned economy/ centrally planned economy/ communism): An economic
system in which resources are allocated via state intervention
7. Division
of labour: It is when a complicated task is broken down into many smaller parts
each done repetitively by a small group of people or individuals
8. Double
coincidence of wants: A situation in a barter system where the seller needs to
find a buyer who wants what is being sold and where the seller also wants something
that the buyer has got to offer
9. Economic
goods: Goods that have a degree of scarcity and hence opportunity cost
10. Economic
growth: An increase in the real GDP/ potential GDP/ productive capacity of an
economy/ when PPC shifts outward
11. Economic
problem: A situation where there are not enough resources to satisfy all the
needs and wants
12. Entrepreneur:
The individual who takes risk in combining other factors of production
13. Fixed
capital: Inputs such as plant, buildings, machinery and vehicles that are used
in the production process
14. Free
goods: Goods that do not have any opportunity cost (oxygen and sunlight)
15. Interest:
The income obtained by depositing money into banks
16. Investment:
Spending onto capital equipment and buildings
17. Land:
The factor of production which includes all natural resources that can be used
in the production process
18. Labour:
The factor of production which includes both mental and physical ability of human
that goes into the production process
19. Liquidity:
The extent in which a financial asset can be easily turned into cash
20. Macroeconomics:
The study of economics at national and international level
21. Market: A way in which both the buyers and sellers interact for the exchange of products
22. Market
economy (free market economy/ capitalism/ laissez-faire economy): An economic
system where scarce resources are allocated via the interaction of demand and
supply
23. Medium
of exchange: The use of money as an acceptable means of payments between buyers
and sellers
24. Mixed
economy: An economic system in which scarce resources are allocated via both
price mechanism and government intervention
25. Microeconomics:
The study of the behaviour of relatively small economic units such as individuals,
households and firms
26. Money:
Anything that is acceptable by the society as a means of payment
27. Needs:
Goods and services that are essential for human survival
28. Normative
statement: A statement which contains value/ subjective judgement which cannot
be clarified as true or false
29. Opportunity
cost: It is the next best alternative forgone
30. Positive
statement: A statement which is factual, cannot be argued and can be testified as
true or false
31. Primary
sector: Production which takes place in agriculture, fishing, forestry, mining
and oil extraction
32. Production
possibility curve/ frontier (PPC/ PPF): A curve that shows the maximum
combination of two goods that can be produced in an economy if all resources are fully and
efficiently utilised
33. Resources:
Inputs available to an economy for use in the production of goods and services
34. Secondary
sector: Production which takes place in manufacturing and construction
35. Specialisation:
It is when individuals, firms and economies concentrate in producing output in
which they have advantage
36. Standard
of deferred payment: Refers to the use of money to purchase an output now but
pay somewhere in the future
37. Store
of value: Refers to the use of money to keep wealth
38. Tertiary
sector: Production which comes in the form of provision of services
39. Transitional
economy: An economy which was formerly centrally planned and which is now opening
up to embrace more elements of the market economy
40. Unit
of account (measure of value): Refers to the use of money to identify the value
of a product
41. Value
judgement: An opinion/ point of view
42. Wants:
Goods and services that are not essential for human survival
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