Capital
A mechanic receives training to work on diesel engines. This contributes to his ________ capital.
Human
What is a market?
All customers willing to pay for a product or service
What never changes when a Supply/Demand graph shifts?
The Price!
When shopping on Facebook marketplace for an air fryer, you check its condition, design, durability, and utility cooking a variety of foods. You are checking what kind of utility?
Form
What indicates the price that will move goods and services by meeting the supply and demand of a market?
Market clearing price or Equilibrium
I need a "small loan of a million dollars" to start my business. What kind of capital am I asking for?
Why do we have an economy?
Wants and needs are unlimited and resources are limited!
What are the two exceptional demand curves?
Monopolistic and Pure Competition
What is time utility?
Making a product or service's availability flexible to the consumer.
(e.g. longer hours on weekends, 24/7 helpline, etc.)
Who has a quantity of goods/services with a willingness to sell them?
Producers
What is physical capital?
tools, machines, technology..."the means of production"
An economy where one group/entity (like the gov't) controls everything, from buying to selling is a ______ economy.
2x points for an example!
Controlled
- USSR or British Empire...to name only 2
What are the shifters of Supply?
Name 3
- Price of resources
- Technology
- Gov't Involvement
- Number of Sellers
- Expectations
A private swimming school being located near a body of water has what kind of utility?
Place Utility
What is a monopoly?
(Think of how you win the game)
A business that dominates a market with no room for competition.
(E.g. Standard Oil used to own and sell most of the oil used in the US)
How do you use social capital?
You tap into social connections and relationships (friendships, family, friendly acquaintances) to help get business going!
What kind of economy does the U.S. currently have?
Private Enterprise Economy
What are the shifters of demand?
Name 3!
- Preferences
- Number of buyers
- Price of related goods
- Income
- Expectations
Possession Utility allows consumers to what?
Be flexible in their ownership by renting products or taking out payment plans/credit.
What does "Lassiez Faire" mean?
"Hands free," as in an economy free of regulation or control
What is intellectual capital
2x bonus if you can give three examples!
The intellectual right or ownership over an idea, product, recipe, etc.
- patent, trademark, copyright
What are the benefits of a free market economy?
- businesses compete for sales, making them lower prices and improve products
- consumers have the agency (freedom) to choose who they buy from depending on preferences and prices
What is the Substitution Effect? What does it impact, demand or supply?
Impacts demand. People will opt for goods/services of equivalent value or utility, depending on price...so price must go down!
What is opportunity cost?
The cost weighed against a choice when resources are scarce because wants/needs are unlimited.
What is the Law of Demand?
2x bonus if you also know the Law of Supply!
- Law of Demand: As prices go down, consumers are willing to buy more!
- Law of Supply: As prices go up, prices are willing to produce/stock more!