Economics Basics
This is the study of how people use resources to meet their wants and needs.
What is economics?
When prices rise, farmers are willing to sell more of these.
What are crops?
A market is a place where people do this.
What is buy and sell goods or services?
What has to happen to the demand of a stock for it to increase in overall price
What is increase?
This is the cost of borrowing money, which can rise or fall with supply and demand.
What are interest rates?
These two forces are key to understanding how prices are determined in a market.
What are supply and demand?
This is the term for the amount of goods producers are willing to sell at different prices.
What is supply?
In markets, inefficiencies occur when these two conditions aren’t balanced
What are supply and demand?
Investors use this economic principle to analyze and predict security prices.
What is supply and demand analysis?
When rates are lowered, companies are encouraged to borrow money to do this.
What is invest in their own development?
Economics helps us understand how the actions of these two groups affect the market.
Who are consumers and producers? (or buyers and sellers)
The demand for this food increases significantly before Halloween.
What are pumpkins?
Freebie for whoever picked
Good job
This company became famous when high demand from investors skyrocketed its stock price.
What is gamestop?
This financial instrument has an inverse relationship with interest rates.
What is a bond?
The central bank of the US
What is the federal reserve?
What is the market clearing price?
When demand is high and supply is low, the market-clearing price tends to do this.
What is increase?
Stock prices can fall when there is a large supply of shares unless this condition is met.
What is matching demand?
When interest rates are high, borrowing money becomes more expensive. Name two ways this can negatively affect companies and the economy.
What are cutting costs and reducing spending?
This system ensures markets work efficiently by creating supply and demand
What are prices?
Effect of increasing production costs for a business
What is decreasing supply?
Markets are most efficient when the total demand equals the total supply, a condition that eliminates these two inefficiencies.
(BONUS FOR 600)
What are surpluses and shortages?
The relationship between stock prices and demand shows that price changes are driven by investor behavior. What must happen to stock supply for prices to rise without an increase in demand?
Stock supply must decrease?
One of the main things that the federal reserve combats
What is inflation?