- Definition of the nature of the economic problem (finite resources and unlimited wants);
- Definition of the factors of production (land, labour, capital, enterprise);
- Definition of opportunity cost and analysis of particular circumstances to illustrate the concept;
- Demonstration of how production possibility curves can be used to illustrate choice and resource allocation;
- Evaluation of the implications of particular courses of action in terms of opportunity cost.
Type Definition Reward Land Labour Capital Enterprise All natural resources The physical and mental works of people All man made tools and machines All managers and organizers Rent Salary/Wage Interest Profit/Loss