Answer:
Question 1
A person responsible for introducing and building a business or an entity, is personally liable for debts, with the main aim of making profits is known as an Entrepreneur.
The Importance of an Entrepreneur's role cannot be far-fetched as he/she is involved in the activating and stimulating of economic activity through the combination of other factors of production i.e. land, labor and capital to produce, manufacture and distribute goods and services for the benefit of the consumer and/or society through the creation of an entity. The formation of new entities by entrepreneurs can result in a decrease of unemployment and also aid the generation and redistribution of economic wealth in the society.
Question 2
- Land- it is a natural resource that comprises the major surface of the earth. The productivity of a business organization is tied down to having a particular location for the smooth running of a business. Every business oriented person or organization needs a spot to execute their business ideas.
- Labor- Human efforts and resources are always needed in the production of goods and services. Even with the advent of artificial intelligence in some business organizations, human labor is still required and this shows how important Labor is to production.
- Capital- Every business needs a start-up capital (money)to effectively run the business. The other factors of production rely on this factor because, without capital (money), the land cannot be maintained and neither will the human factor (labor). For instance, on a farm, capital is needed to purchase some machinery like tractors, raw materials, among other types of equipment.
Question 3
Opportunity costs shape economic decisions in ways that help decision-makers (especially policymakers) to choose the best option from other alternatives after much consideration of the factors of productions, potential risks and the returns of investment of projects at hand. It is the amount of what you forego in order to purchase another option(goods) in return. That an individual chooses a particular option over the other, does not mean it is of less importance.
Question 4
Marginal cost is the amount of money it will take to produce an extra unit of a good or services.
Marginal help in managerial decisions through the identifying of best resource allocation given the constraints of the business, formulating of best price for the produced goods and services and also in comparing alternative production techniques, in line with the organization’s goals. You plan to produce 20 items for 200 dollars and let's say along the line you discovered you need to produce an additional 5 items, making it 25 items at 300 dollars. So, the formula for calculating your marginal cost is; Change in cost divided by change in quantity i.e 300-200 divided by 25 minus 20= 100/5=20 which is the cost of producing the additional 5 units.
Question 5
The Production Possibilities Curve- A graphical representation that shows the different combinations of two goods produced in an economy when allocated resources are efficiently utilized.For instance, you have a bucket of water and you use it to produce 10 items today, subsequently, you add one more bucket of water, making it two. so instead of the 10 you previously produced, you will now produce 20 items. Normally, in the graph, an increase in one side leads to an increase in the other side and this causes the production curve to move outward, showing the increase in economic growth. Where the curve moves inward, it means there is a decrease in economic growth.
Question 6
Economic efficiency also known as economic growth is when all goods and factors of production in an economy are distributed or allocated and are well utilized and waste is minimized. Efficiency in an economy or a society is important because allocated resources are fully utilized by the social and economic losses, and benefits are equally shared. It also means the capacity or ability to produce more goods and services considering the resources put in place.