Topic 1
Limited resources to satisfy unlimited wants
What is scarcity?
The 3 basic economic questions are: (1) What goods and services should be produced? (2) How should they be produced? and (3) ____________
What is "Who gets the goods and services that are produced?"
This kind of market is dominated by a few large firms.
What is an oligopoly?
This reduces your money's purchasing power.
What is inflation?
According to the Constitution, which government body has the power to levy taxes?
What is the Congress?
The factors of production include land, labor, and ________________
What is capital?
The unseen force that causes supply and demand in a free market to reach equilibrium as consumers and producers pursue their own self-interest.
What is the invisible hand?
In this economic system, the government owns or controls almost all of the resources and means of production.
What is a command, or centrally planned, economy?
An investment strategy of not putting all of your eggs in one basket.
What is diversification?
This makes up about half of federal discretionary spending.
What is national defense?
They combine resources (factors of production) to create innovative products and production techniques.
Who are entrepreneurs?
The circular flow model of the economy has two markets: the product market and the ________ market.
What is resource or factor?
Easy market entry and exit, many sellers, and identical products are all characteristics of this type of market.
What is pure competition?
This type of money has value because it is backed by a government in which people have confidence.
What is fiat money?
When there is a recession, the government tries to use this type of stabilization policy.
What is expansionary?
The knowledge and skills workers get through their training, education, and experience
What is human capital?
This states that, "Keeping other factors constant, if the price of a good increases, the quantity supplied will increase."
What is the law of supply?
This type of business organization raises capital by selling stocks or bonds.
What is a corporation?
Increases in productivity lead to this.
What is economic growth?
This government body institutes monetary policy.
What is the Federal Reserve?
In order of preference, Sam likes to hang out with friends, read books, and sleep. If chooses to hang out with friends, his _____________ ________ is the pleasure he would have gotten reading a book.
What is opportunity cost?
If the price of ski boots goes up, this will probably happen to the demand for skis.
What is "go down"?
The biggest disadvantage of a sole proprietorship
What is unlimited liability?
Name four of the characteristics money should have.
What is portable, uniform, durable, and divisible? (or limited)
The main source of revenue for most local governments.
What is the property tax?