terms
Define a market
interaction between buyers and sellers
If the costs of inputs decreases, the supply usually...?
increases
Who owns/controls factors of production in a Free Market?
private ownership of resources
What type of economic system does the United States have?
mixed
What are the three basic questions every economic system has to decide?
What to make. Who should make it. How to make it.
Define a trade-off
choosing one thing over another
Who owns/controls factors of production in a Free Market?
private ownership of resources
If more supplies enter the market, which way would the supply curve move?
right
According to the Law of Demand, as price goes up the demand...?
demand goes down
What is the most common type of business in the United States?
sole-proprietorship
Define opportunity cost
what is lost when you choose one thing over another; value of the next best alternative
What does it mean when the demand is elastic?
a small change in price causes a big change in demand
What is "diminishing marginal value"?
with each additional unit, the usefulness of the product changes
What are the three types of businesses?
sole-proprietorship, partnership, corporation
Moneyless societies use what method of exchange?
barter
Define the marginal cost of production
cost to make one more
What are the two types of costs that add up to the total cost?
fixed and variable
What is the term for the government spending more than its budget?
deficit spending
What is the most responsible way to use a credit card?
make purchases that you can pay in full at the end of the month
What helps MAKE the U.S. dollar weak?
trade deficit (more imports than exports/too much supply of US dollars in foreign places)
what is voluntary exchange
term for a trade that isn't forced but everyone benefits from
What is the economic concept that determines why companies complete?
scarcity
What tools does the Fed have to control the money supply?
discount rate, open market operations, reserve requirements
What makes international trade so complicated?
foreign exchange rate
How do entrepreneurs help the economy?
earn money for themselves, create jobs for others, create products, and pay taxes