Just the basics
The study of how people produce, distribute, and use goods and services
Factors of production
The money a person makes
Income
The oldest and simplest economic system
Traditional economy
In this economic system, change occurs every slowly
Traditional
The goods that are used to make goods and services
Factors of production
Refers to all natural resources used to make goods and services
Land
The income people receive in return for supplying land, labor, or capital
Factor Payment
In this economic system, decisions about the three economic questions are made by voluntary exchange
Free Market Economy
A business that uses resources in order to produce a product or service for sale
Firm
These are the two types of capital
Physical Capital
Human Capital
Labor
The process of bringing new methods, products, or ideas into use. This plays a large role in economic growth
Innovation
The circular flow chart shows these two markets
Factor and Product
In 1776 Adam Smith published this book, observing that an economy is made up of many exchanges all serving the buyer's and seller's self-interest
The Wealth of Nations
Refers to the total value of all goods and services produced in a country
Gross Domestic Product (GDP)
Refers to any resource used by humans to make other goods and services
Capital
A set of programs designed to protect people who face economic hard times
Safety Net
Economic system in which government owns both land and capital - also decide where workers will work and how much they will earn
Centrally Planned Economy
A political and economic system in which the means of production are owned by the state
Socialism
Equilibrium quantity and price come from where?
The equilibrium point
The added training that an employer gives to an employee, is a good example of what
An addition to their human capital
What should be produced?
How should it be produced?
Who should get the goods and services?
Centrally planned economies, sometimes have a ____________ government
Socialist
Communism is derived mostly from the writings of
Karl Marx