PPC
If a point is on the line it means that
all resources are being used efficiently
the fundamental problem that drives economics is
scarcity
An economic system with a combination of command, traditional, and market economies
mixed
free choice in buying and selling (economic action)
voluntary exchange
TINSTAAFL reminds us that everything has a ___________
cost
If a point is inside the curve it means that
resources are being used inefficiently
if you have to have something to survive it is a
need
An economic system in which the questions of the economy are answered based on family patterns and rituals
Traditional
the driving force that encourages people to improve their economic situation
profit
The need for people to be rewarded for risk and effort in a free market economy is also known as
profit motive
If a point is beyond the curve we know that
that level of production is not possible
The most expensive things are often not the most essential things
Paradox of value
An economic system in which the government determines what is produced, how it is produced, and who gets what is produced
command
person who takes economic risks to start new businesses
entrepreneur
consumer good
When you produce more of one thing instead of another, that change in production of thing you did not choose is called
opportunity cost
something used to produce something else (ie) tools, equipment
capital goods
an essential characteristic of a capitalist free enterprise economy in which people own their resources and use them as they choose
private property
The role of the consumer as the decision maker in the market
consumer sovereignty
If a country is moving away from collectivism and is instead privatizing, what is it doing?
allowing private people/businesses to own more of the means of production
a PPC curve does not tell you ___________________, it only tells you what can be produced
what to produce
when a task is separated into smaller tasks so that a person can learn just that one part and do it over and over again
Division of labor
Socialism and capitalism are both terms that tell you what about an economy
who owns the means of production
The three questions all economies answer
what to produce, how to produce, and for whom
The central problem of the Great Recession was
housing