Economic Choice
To satisfy seemingly unlimited and competing wants with the careful use of scarce resources; a social science.
What is economics?
A thing that motivates or encourages someone to act in a specific way or manner
What is an incentive?
The "father" of communism.
Who is Karl Marx?
Citizens can start businesses.
What is private enterprise?
The most common form of business organization in the United States.
What is a sole proprietorship?
Wants are unlimited, but the resources necessary to satisfy those wants are scarce
What is scarcity?
Coupons, discounts, bonus
What are positive incentives?
He wrote the Wealth of Nations, which promoted free markets.
Who is Adam Smith?
This leads to innovation, better products, fair prices, and the hiring of capable employees.
What is competition?
Jointly owned by two or more persons.
What is a partnership?
The loss of a potential gain from one decision, when you instead make an alternative choice
Opportunity Cost
Late fees, partial credit, losing privileges?
What are negative incentives?
Private property, business profits, entrepreneurship.
What is capitalism?
Citizens own society’s productive resources (natural, capital, & human)
What is private property?
A separate legal entity having all the rights of an individual.
What is a corporation?
Natural Resources, Human Resources, Capital Resources
What are Factors of Production?
If the price of a product increases, consumers may reduce their demand for it, leading to a decrease in sales.
What is Price Incentive?
No private property, classless society, redistribution of wealth.
What is communism?
Profit and material wealth encourages hard work and seeking high paying jobs.
What is profit motive?
After two failed companies, this man achieved success on his third try, leading to one of the world's most recognizable chocolate companies.
Who is Milton Hershey?
Guns and Butter
What is the Production Possibility Frontier (PPF) Curve?
Deductions for certain expenses, such as home mortgage interest or business expenses.
What is a tax incentive?
Society benefits when individuals act in their own self-interest.
What is the Invisible Hand theory?
Their dollars decide which products should stay & what businesses should thrive.
What is consumer sovereignty?
Ease of raising capital, someone else runs the business, liability is limited, organization continues to exist even when ownership changes.