Introducing Economy
What is an economy?
A system of consumers, businesses, and governments that produce, consume, and distribute goods and services.
What are the three basic economic questions?
What to produce, how to produce, and for whom to produce.
True or False: In a traditional economy, people often have the same jobs as their ancestors.
True
What is an entrepreneur?
Someone who creates and develops a new business, taking financial risks to make profit or impact.
Why do people compare prices when shopping?
To save money and find better deals.
What are the main parts of an economy?
Production, consumption, and distribution.
What defines a traditional economy?
Customs and traditions guide production and jobs.
True or False: In a command economy, private businesses decide prices.
False — the government decides prices.
What skill helps entrepreneurs find market gaps?
Opportunity recognition.
What kind of product or service might an entrepreneur create?
Any product that solves a problem or meets a need.
What is the main purpose of an economy?
To meet people’s growing needs as life conditions change.
In a command economy, who controls production and prices?
The government.
True or False: In a market economy, competition and innovation are encouraged.
True
What does “innovation” mean for entrepreneurs?
Creating new products, services, or ways of doing business.
What does the term “distribution” mean?
Getting goods or services to consumers.
What can an economy include besides a nation?
A region, an industry, or even a family.
What type of economy is based on supply and demand?
Market economy.
True or False: The U.S. has a command economy.
False — it mostly has a market economy.
What does “risk-taking” mean in business?
Taking chances or financial risks to start a business.
What’s one strategy for saving money on groceries?
Comparing prices or avoiding unnecessary items.
Why is the economy essential for society?
It organizes how resources are used and how needs are met.
What is a mixed economy?
A combination of private freedom and government involvement.
True or False: A mixed economy combines features of different economic systems.
True
How do entrepreneurs contribute to the economy?
By driving innovation, growth, and job creation.
How do entrepreneurs help society beyond making money?
They create solutions and positive social impacts.