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Economic Systems
Economic/Social Goals
Capitalism
Vocabulary
Grab Bag
100
An organized way of providing for the wants and needs of a society's people
What is an economy/economic system?
100
An economic goal that is based on the desire of people to make their own decisions
What is economic freedom?
100
The act of buyers and sellers freely and willingly engaging in market transactions
What is voluntary exchange?
100
The extent to which persons or organizations are better off at the end of a period than they were at the beginning (of a transaction)
What is profit?
100
Economic system in which a central authority makes most of the WHAT, HOW, and FOR WHOM decisions.
What is a command economy?
200
Economic system in which the allocation of scarce resources stems from ritual, habit, or custom
What is a traditional economy?
200
An economic goal that is based on a sense of of fairness
What is economic equity?
200
the privilege that entitles people to own and control their possessions as they wish
What is private property rights?
200
Rise in prices
What is inflation?
200
Economic and social goal that results from people's desire for their economic system to provide as many jobs as possible.
What is full employment?
300
What is one advantage of a command economy?
--capable of dramatic change in a short time --many basic education, public health, and other public services available at little or no cost
300
An economic goal that is based on the desire of people to use resources wisely (resources are not idle)
What is economic efficiency?
300
The driving force that encourages people and organizations to improve their material well-being
What is profit motive?
300
The United States has this type of economy.
What is mixed or modified private enterprise economy
300
Describes the consumer as ruler of the market (more commonly expressed by saying "the customer is always right")
What is consumer sovereignty?
400
Name one advantage of a market economy.
--Able to adjust to change gradually --individual freedom for everyone --lack of government interference --incredible variety of goods and services --high degree of consumer satisfaction
400
An economic goal that is based on preventing inflation
What is price stability?
400
The struggle among sellers to attract consumers while lowering costs
What is competition?
400
An income that does not increase even though prices of goods and services go up
What is fixed income?
400
Give an example of a command economy.
What is North Korea, former Soviet Union, Cuba
500
Name one disadvantage of a market economy.
--Rewards only productive resources; does not provide for people, too old, or too sick to work --Workers and businesses face uncertainty as a result of competition and change --does not produce enough public goods such as defense, universal education, or health care --Must guard against market failure
500
An economic goal that is based on the desire for protection from adverse economic events (layoffs, sickness, etc.)
What is economic security?
500
Name one role of the government in a capitalist society.
--protector (enforces laws against false advertising) --Provider and Consumer (provides defense services, consumes factors of production) --Regulator (oversees interstate commerce)
500
A federal program of disability and retirement benefits that covers most working people
What is Social Security?
500
Name one disadvantage of a traditional economy.
--discourages new ideas and new ways of doing things --stagnation and lack of progress --lower standard of living