I'M NOT A PART OF YOUR SYSTEM!
In this economic system, the gov't owns the factors of production
COMMUNISM
What are the 3 basic economic questions?
How to produce it
Who are we producing it for?
If prices rise, then a business wants to supply more.
These types of businesses put competition out of business, and are regulated by anti-trust laws
MONOPOLY
The most common way to measure a nations economy-the total value of all the goods and services produced in a year
GDP
These actions, such as taxes & gov't spending, are used by the gov't in order to affect the economy.
FISCAL POLICY
Adam Smith believed that THIS is what controls the market, the gov't doesn't need to intervene
INVISIBLE HAND
SCARCITY
If prices rise, then consumers want to purchase less.
LAW OF DEMAND
Education level & individual skills tend to be important factors when it comes to this..
EXPECTED INCOME LEVEL
The Consumer Price Index (CPI) measures the price of goods. Unfortunately, prices are rising too fast right now, which is called this...
INFLATION
The gov't tries to protect domestic businesses by using these types of taxes on imported goods.
TARIFF
All businesses are driven by this incentive.
PROFIT
These are the things that you decide NOT to spend your resources on.
OPPORTUNITY COST
The point where supply and demand meet, also called "perfect pricing"
EQUILIBRIUM
In the US, when businesses secretly conspire together to set prices this is illegal
COLLUSION
It's unfortunate when you lose a job. It's scary when job losses are caused by an economic downturn which causes this type of unemployment
CYCLICAL
In MONETARY POLICY, what is used when they lower interest rates and make loans easily available?
EASY MONEY POLICY
Our American economic is system is known as THIS & is characterized by private ownership of business and property, competition & self-interest
FREE ENTERPRISE
A business's cost to produce "one more" of its product.
MARGINAL COST
DIMINISHING MARGINAL RETURN
Workers from the same type of work sometimes join together to form one of these.
LABOR UNION
If you spend more than you make, you go broke. When the gov't spends more than it makes, it's called this..
BUDGET DEFICIT
If the Gov't tries to slow down the economy by removing money from circulation(taxes), it is using this type of Fiscal Policy..
RESTRICTIVE/CONTRACTIONARY POLICY
Products that are used by all of us, such as roads, are provided by the gov't through our tax dollars
PUBLIC GOODS
When the price of a product rises and causes a drop in demand, the demand is now this..
ELASTIC
A business must know its Cost of Production in order to set prices. These types of costs are fixed- they never change (rent, insurance, etc)
OVERHEAD
CARTEL
When prices rise, workers demand more money, which leads to higher cost of production and then higher prices, which leads to demand for more money.. and so on..
WAGE-PRICE SPIRAL
If the US is better at producing cars than India
ABSOLUTE ADVANTAGE
In free enterprise, the gov't stays out of the economy, except when they set a PRICE FLOOR -a gov't regulation on the price of labor- you can't pay someone less than/under this
MINIMUM WAGE
When a business creates a product, one unseen cost of production may be noise and pollution, which are known as THIS
(negative) EXTERNALITIES
This is when there is demand for a product, it drives businesses to hire more workers.
DERIVED DEMAND
The gov't regulates markets in order to protect this group of people from being taken advantage of.
CONSUMERS
To determine how things are going, the gov't measures the poverty rate to know how many are living below this statistical line..
POVERTY LINE
If Americans buy more Chinese goods than Chinese buy of American goods, we have one of these..
TRADE DEFICIT