| A | B |
|---|
| Production | The transformation of inputs into outputs by firms in order to earn profit (or meet some other object) |
| Consumption | The act of using goods and services to satisfy wants. This will normally involve purchasing the goods and services. |
| Factors of production (or resources) | The inputs into the production of goods and services - labour, land (raw materials) and capital. |
| Labour | All forms of human input, both physical and mental, into current production. |
| Land (Raw materials) | Inputs into production that are provided by nature. For example unimproved land and mineral deposits in the ground. |
| Capital | All inputs into production that have themselves been produced. For example factories, machines and tools. |
| Scarcity | The excess of human wants over what can actually be produced to fulfil these wants |
| Demand | The desire and ability to buy a good or service. |
| Supply | The desire and ability to sell a good or service |
