Definitions
The amount of some good or service consumers are willing and able to purchase
Demand
The value of the next best alternative given up when making a choice
Opportunity cost
The number of factors of production.
Four
A term used to describe how trade and technology have made the world into a more connected and interdependent place.
Globalization
Invented by Karl Marx
Communism
the number of units of goods or services a supplier is willing and able to bring to the market
Supply
The total monetary value of all final goods and services produced within a country's borders in a specific time period, usually a year or quarter
GDP
All naturally occurring resources
Land
An economic system characterized by competition and free trade.
Market Economy
Father of capitalism
Adam Smith
The fundamental problem of having seemingly unlimited human wants and needs in a world with limited resources.
Scarcity
Occurs when supply is high but demand is low
Surplus
Land comes in two forms
Renewable and nonrenewable
The government or a central authority makes all key decisions.
Command economy
Socialist or Socialism
Where current prices stabilize between even supply and demand
Equilibrium
When demand for a product or service exceeds the available supply.
Shortage
tools, buildings, machinery
Capital
An economic system combining private enterprise (market forces) with government regulation and ownership.
Mixed Economy
A system based on private ownership of the means of production (factories, mines, businesses) and their operation for profit, where prices, production, and distribution are determined by market competition rather than state control.
Capitalism
The relationship between what people want and how much of it is available.
Supply and Demand
A mandatory payment or charge collected by local, state, and national governments from individuals or businesses.
Taxes
referring to the human skills, creativity, and risk-taking capacity
Entrepreneurship
An economic system based on customs, history, and beliefs
Traditional Economy
Examples include- China, Cuba, Laos, North Korea, and Vietnam
Communism- Modern communist countries