The two basic sets of participants in any economy are households and firms.

The N3 highway connecting Johannesburg and Durban is an example of a capital good.

T A highway facilitates production by enabling the movement of intermediate and final goods. It also lasts for a long time, and therefore it can be regarded as a capital good.

Capital refers to all tangible goods that are used to produce other goods.

The entrepreneur is the driving force behind the production process.

The term “human capital” refers to the number of workers.

There is an unlimited supply of natural resources.

The four factors of production are natural resources, labour, entrepreneurship and money.

Real production refers to the current value of goods that were produced in the economy.

Members of households are called consumers.