Economic Basics
The fundamental problem of having unlimited wants but limited resources.
What is Scarcity?
When the quantity supplied exceeds the quantity demanded, this exists.
What is Law of Demand/Demand?
A business owned and managed by a single individual who keeps all profits.
What is Sole Proprietorship?
The act of trading goods or services directly without using money.
What is Barter?
A regular payment made by an employer to an employee for work.
What is Salary/Wages?
The most valuable alternative given up when making a choice.
What is Opportunity Cost?
When the quantity supplied exceeds the quantity demanded, this exists.
What is Surplus?
A business organization owned by two or more people.
What is Partnership?
A tax placed by a government on imported goods.
What is Tariff?
The cost of borrowing money, usually expressed as a percentage.
What is Interest?
People who take risks to combine resources and start new businesses.
What is Entrepreneurs?
This term describes how sensitive consumers are to a change in price.
What is Elasticity?
A legal entity owned by individual stockholders with limited liability.
What is Corporation?
The difference in value between a nation's total imports and exports.
What is Balance of Trade?
A portion of a company's profit paid out to its stockholders.
What is Dividend?
The "human" factor of production, including skills and knowledge.
What is Human Capital?
Costs that do not change, regardless of how much a business produces.
What is Fixed Costs?
This occurs when a single company has total control over a market.
What is Monopoly?
A government payment that supports a domestic business or industry.
What is Subsidy?
A diversified collection of investments, such as stocks and bonds.
What is Portfolio?
The three basic economic questions every society must answer.
What is:
What to produce?
How to produce?
For whom to produce?
The point where the supply and demand curves intersect.
What is Equilibrium?
Standards of conduct and moral values followed by a firm.
What is Business Ethics?
A limit on the amount of a specific good that can be imported.
What is Quota?
The central bank of the United States that manages monetary policy.
What is Federal Reserve?