The basic economic problem that arises because people have unlimited wants but resources are limited. Because of it, various economic decisions must be made to allocate resources efficiently.
What is scarcity?
100
The work a mechanic, teacher, accountant, or professional athlete performs.
What is labor?
100
The 3 basic economic questions are addressed according to custom (or the way things have always been done).
What is a traditional economy?
100
The willingness and ability to purchase goods and services at particular prices.
What is demand?
100
Calculated by dividing the number of people who are out of work but looking by the total available labor force.
What is unemployment?
200
The cost of an alternative that must be forgone in order to pursue a certain action. Put another way, the benefits you could have received by taking an alternative action.
What is opportunity cost?
200
Land, water, and fossil fuels.
What are natural resources?
200
The 3 basic economic questions are addressed by buyers (consumers) and sellers (producers) alone
What is a (free) market economy?
200
The willingness and ability to produce goods and to provide services at particular prices.
What is supply?
200
An increase in the price of goods and services over time (2-3% is the target rate).
What is inflation?
300
The phase of the business cycle in which the economy is growing but has not yet reached its peak.
What is expansion?
300
Money invested, a computer network, and office supplies.
What is capital (and capital goods)?
300
The 3 basic economic questions are addressed by a centralized government or authority.
What is a command economy?
300
Arises when the quantity supplied exceeds the quantity demanded. It signals that prices are too high and should be lowered.
What is surplus?
300
A measure of the total value of goods and services produced in a country in a given year.
What is gross domestic product (GDP)?
400
The phase of the business cycle in which the economy is shrinking but has not yet reached its trough.
What is contraction?
400
The assumption of risk, the creation or invention of new goods and services, and the ability to increase productivity.
What is entrepreneurship?
400
The 3 basic economic questions are addressed in combination by custom, a centralized government or authority, and buyers (consumers) and sellers (producers).
What is a mixed economy?
400
Arises when the quantity demanded exceeds the quantity supplied. It signals that prices are too low and should be raised.
What is a shortage?
400
A reduction of the general level of prices in an economy.
What is deflation?
500
Two consecutive quarters of negative economic growth as measured by a country's gross domestic product (GDP).
What is recession?
500
A practice used by different companies to reduce costs (and increase profits) by transferring portions of work (factors of production) to outside suppliers rather than completing it internally.
What is outsourcing?
500
The 3 most basic economic questions a community, society, or nation must answer.
What are 1) What to produce? 2) How to produce it? 3) For whom is it produced?
500
The point at which demand equals supply and neither surplus nor shortage exists.
What is (market) equilibrium (or equilibrium price)?
500
A statistical estimate constructed using the prices of a sample of representative items (e.g. milk and gas) whose prices are collected periodically.