Thinking like an Economist
The condition resulting in a society not having enough resources to produce all the things you would like to have.
Scarcity
A central authority makes the major decisions about what is produced, and is usually controlled by the government.
Command economy
When an economy has both capitalism and free market and resources are privately owned.
Free enterprise
Rule stating that more will be demanded at lower prices and less at higher prices
Law of Demand
products that increase the use of other products
compliments
The study of how people try to satisfy unlimited wants and needs with limited resources.
Economics
an economic and political system in which the government owns some, but not all factors of production.
Socialism
A fundamental feature of capitalism, which allows individuals to own and control their possessions
Private property rights
graph showing the quantity demanded at each and every possible price in the market at a given time.
demand curve
economic and political system in which factors of production are collectively owed and directed by the state
Communism
The monetary value of all goods and services produced by a country in a given year.
Gross domestic product
People make their own economic decisions based on their interests and motives.
Market economy
A person who organizes and manages resources in order to seek the reward called profit
Entrepreneur
Marginal utility
worst period of economic decline in U.S. history in the 30's
Great Depression
The cost of the next best alternative when one decision is made over another.
Opportunity cost
An economic system where private citizens own and use the factors of production for their own profit and gain.
Capitalism
Federal program for disability and retirement benefits that covers most working people
Social Security
the portion of a change in quantity demanded caused by a change in a consumers income when a price of a product changes
income effect
quality of life based on ownership of necessities and luxuries that make life easier
standard of living
the measure of the amount of goods and services produced with a given amount of resources in a specific period of time.
Productivity
Mixed Economy
Inflation
Competing products that can be used in place of one another
substitutes
cost-benefit analysis