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Chapter 2

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Question
Answer
capital   anything made by man that is used to produce goods and services.  
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land   anything supplied by nature that is used in the production of goods and services.  
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labour   all human effort that goes into the production of goods and services.  
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enterprise   the factor of production that takes the initiative in organizing land, labor and capital that bears the risk involved in production.  
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centrally planned economy   an economy that controlls and directs all economic activity (also called a command economy)eg.cuba  
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mixed economy   an economy where private enterprises and state enterprises both exist and where the government exersices a certain amount of activity. eg.Ireland  
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free enterprise economy   an economy where activity is undertaken by companies and individuals who are free to operate without undue government interference.(also called a free market economy). eg. united states of America.  
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depreciation   the using up or wearing out of capital in a year.  
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factors of production   the resources or inputs that are required to produce goods and services.  
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fixed capital   stock of fixed assets.  
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gross investment   the total amount of capital created in an economyin a year.  
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net investment   gross investment minus depreciation.  
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non-renewable resources   natural resources that's supply cannot be replenished.  
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renewable resources   natural resources that's supply can be replenished.  
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social caplital   capital owned by society in general.  
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working capital   manufactured raw materials,partly finished goods and finished goods  
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Created by: jmartineconomics
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