Key Terms
Opportunity cost
Economic system where roles are defined by the customs of elders and ancestors.
Traditional Economy
The government sub-agency, BLS, stated that over the past two decades the U.S. economy has shifted from manufacturing jobs to __________
service-producing jobs.
a private investment organization that employs risky strategies that often make huge profits for investors.
Hedge Fund
measures a country's gross domestic product using current prices, without adjusting for inflation.
Nominal GDP
"all other things being equal." In economics, it acts as a shorthand indication of the effect one economic variable has on another, provided all other variables remain the same.
Ceteris Paribus
The right of a government or its agent to expropriate private property for public use, with payment of compensation.
Eminent Domain
A market structure in which many companies sell products that are similar but not identical.
Monopolistic Competition
A bond with high risk and POTENTIALLY high yield
Junk Bond
Transitional unemployment due to people moving between jobs.
Frictional Unemployment
selling a product below cost for a short period of time to drive competitors out of the market.
Predatory Pricing
DOUBLE JEOPARDY:
Principle that more will be offered for sale at higher prices than at lower prices.
Law of Supply
the practice of contracting with another company to do a specific job that would otherwise be done by a company's own workers.
Outsourcing
Money is anything that serves as:
a medium of exchange, a unit of account, and a store of value.
The federal government's fiscal year ranges between what dates?
October 1 - September 30
A minimum price, set by government, that must be paid for a good or service. This price is ABOVE the equilibrium price. The byproduct of this would be a surplus.
Price Floors
Liberal brand of Command Economies. Economic system in which government owns some factors of production and has a role in determining what and how goods are produced.
Socialism
An agreement among members of an oligopoly to illegally set prices and production levels. Illegal in the United States.
Collusion
Investor pays fee for option to buy stock six months from now at today's price.
Call Option
an increase in government spending, a decrease in tax revenue, or a combination of the two—is expected to spur economic activity is known as what?
Expansionary Fiscal Policy
Adam Smiths theory of a metaphor for the unseen forces that move the free market economy. Through individual self-interest and freedom of production and consumption, the best interest of society, as a whole, are fulfilled.
The Invisible Hand (Laisse Faire)
What six factors can shift a demand curve?
Changes in Income, Consumer Expectations, Changes in Demographics, Change in Population, Consumer Tastes and Adver., Price of Related Goods
DOUBLE JEOPARDY:
What is the "Monopolists Dilemma"
If a monopolist produces more, the price of the good will fall and minimize profit, and if it produces less, the price will rise and lose business.
Financial assets that can be redeemed ONLY by the original buyer are sold on which market?
Primary Markets
the value of a currency expressed in terms of the number of goods or services that one unit of money can buy.
Purchasing Power