Econ 101
the inability to satisfy all wants at the same time. All resources and goods are limited. This requires that choices be made.
What is SCARCITY
Resiurces that are used in the production of goods and services. (Natural, human, capital, entrepreneurship)
What are FACTORS OF PRODUCTION
Consist of earnings after all expenses have been paid
What is PROFIT
Economic decisions are based on custom and historical precedents. People often perform the same type of work as their parents and grandparents regardless of ability or potential. Think barter.
What is TRADITIONAL ECONOMY
The effect on demand when the price increases.
What is DECREASES.
amount of money exchanged for a good or service. Determined by interaction of supply and demand. Determines who acquires good and services.
What is PRICE
using of goods and services. Consumer preferences and price determine what is purchased and used
What is CONSUMPTION
Generally allowed to operate without undue interference from the government. Prices are determined by supply and demand as buyers and sellers interact in the marketplace.
What is MARKETS
Individuals are businesses are owners and decision makers for the private sector Government is owner and decision maker for the public sector Government's role is greater than in a free market economy and less than in a command economy. Most economies today, including the United States.
What is MIXED ECONOMY
This illegal practice often happens after natural disasters.
What is PRICE-GOUGING.
selection of an item or action from a set of possible alternatives. Individuals must make decisions about desired goods and services because these goods and services are limited.
What is CHOICE
Determines price. Amount of a good or service that consumers are willing to BUY at a certain price.
What is DEMAND
Individuals and businesses have the right to own real and personal space as well as the means of production without undue interference from the government
What is PRIVATE PROPERTY
private ownership of property/resources profit motive competition consumer sovereignty individual choice minimal government involvement in the economy
What is FREE MARKET ECONOMY
A person who takes a risk to produce and sell goods and services in search of profit
What is ENTREPRENEUR
things that incite or motivate. Used to change economic behaviors
What are INCENTIVES
Determines Price. Amount of a good or service that producers are willing to SELL at a certain price.
What is SUPPLY
Rivalry between producers and/or between sellers of a good or service usually results in better quality goods and services at lower prices.
What is COMPETITION
Central Ownership (usually by government)of property/resources Centrally-planned economy Lack of consumer choice
What is COMMAND ECONOMY
This problem in America is characterized by a significant gap between the "haves" and the "have nots."
What is the POVERTY PROBLEM.
what is given up when a choice is made-i.e the highest valued alternative is forgone. Individuals must consider the value of what is given up when make a choice
What is OPPORTUNITY COST
combining of human, natural, capital, and entrepreneurship resources to make goods or provide services. determined by resources available and consumer preferences.
What is PRODUCTION
The two factors that make up the "invisible hand" of a free market economy.
What are SELF-INTEREST AND COMPETITION.
Government owns the means of producing goods and services. People have no say in how their economy is run.
What is COMMUNISM
One example of macroeconomics.
What is STOCK MARKET (etc.)