Supply and Demand
This occurs when quantity demanded equals quantity supplied.
What is equilibrium?
This economic idea explains why countries benefit by specializing and trading goods.
What is comparative advantage?
This is the possibility that an investment could lose value.
What is market risk?
The United States economy is BEST described as this type of economy.
What is a mixed economy?
This basic economic problem exists because wants are unlimited but resources are limited.
What is scarcity?
This happens when prices are set above equilibrium and producers make more than consumers want to buy.
What is a surplus?
A decrease in the value of the U.S. dollar would MOST LIKELY cause this to increase.
What are exports?
Spreading investments across different assets to reduce risk is called this.
What is diversification?
This type of policy includes government spending and taxation decisions.
What is fiscal policy?
The value of the next best alternative given up is called this.
What is opportunity cost?
A natural disaster damaging factories would MOST LIKELY cause this curve to shift left.
What is the supply curve?
One weakness of globalization shown during COVID-19 was that these could be disrupted.
What are global supply chains?
Education, training, and job experience are examples of this.
What is human capital?
Buying government bonds is one way the Federal Reserve increases this.
What is the money supply?
A country moving from one point to another on a PPC is reallocating these.
What are resources?
This law states that consumers generally buy less of a product as prices increase.
What is the Law of Demand?
This can happen to domestic workers when companies outsource jobs overseas.
What is increased competition from lower-wage workers?
Longer-term loans usually have higher interest rates because lenders face more of this.
What is risk?
When the Federal Reserve buys bonds, these usually decrease.
What are interest rates?
A country can move beyond its PPC by improving this or gaining more resources.
What is technology?
This government policy sets a legal minimum price above equilibrium.
What is a price floor?
This term describes the movement of factories or jobs to countries with lower labor costs.
What is outsourcing?
This occurs when investors drive prices far above actual value before a collapse.
What is a market bubble?
This economic approach favors limited government involvement in business.
What is laissez-faire economics?
All economic systems must answer these three questions: what to produce, how to produce, and this.
What is “for whom to produce”?