Chapter 1
The study of how people make choices about ways to use limited resources to fulfill their wants
Economics
Way in which a nation uses its resources to satisfy its people's needs and wants
Economic System
Any person or group that buys or uses goods and services to satisfy personal needs and wants
Consumer
Receipt of funds either directly or indirectly to buy goods and services in the present with the promise to pay for them in the future
Credit
Store that carries a limited number of brands and items in large quantities and is less expensive than grocery stores
Club Warehouse Store
The branch of economic theory that deals with behavior and decision making by small units such as individuals and firms
Microeconomics
System in which economic decisions are based on customs and beliefs that have been handed down from generation to generation.
Traditional Economy
Income remaining for a person to spend or save after all taxes have been paid
Disposable Income
Amount originally borrowed in a loan
Principal
Store open 16-24 hours a day, carrying a limited selection of relatively higher-priced items
Convenience Store
The branch of economic theory dealing with the economy as a whole and decision making by large units such as governments
Macroeconomics
System in which the government controls the factors of production and makes all decisions about their use
Command Economy
Money income a person has left to spend on extras after necessities have been bought
Discretionary Income
Amount the borrower must pay for the use of someone else's funds
Interest
Lower-priced store-brand products carried by some supermarket chains and club warehouse chains
Private-Labeled Products
Basic Economic problem that results from a combination of limited resources and unlimited wants
Scarcity
System in which individuals own the factors of production and make economic decisions through free interaction while looking out for their own and their families' best interests
Market Economy
Choosing the alternative that has the greatest value from among comparable-quality products
Rational Choice
Type of loan repaid with equal payments, or installments, over a specific period of time
Installment Debt
Ability of an item to last a long time
Durability
Resources of land, labor, capital and entrepreneurship used to produce goods and services
Factors of Production
The process of freely exchanging goods and services between buyers and sellers
Market
advertising that attempts to persuade consumers that a product is different from and superior to any other
Comparative Advertising
Manufactured items that have a life span longer than three years
Durable Goods
Amount of use a person gets from an item over time and the value a person places on the use
Service Flow