Intro to Economics
the situation of not having enough resources to satisfy all one's wants
Scarcity
risk-taking individual who starts a new business, introduces a new product, or improves a management technique
Entrepreneur
association of workers organized to improve wages and working conditions
Labor Union
the promise made by a manufacturer or a seller to repair or replace a product within a certain time period if it is faulty
Warranty
legislation to prevent new monopolies from forming and preserve and promote competition
Antitrust Law
a financial institution that offers full banking services to individuals and businesses
Commercial bank
an expense that does not change no matter how much a business produces
Fixed Cost
when people, businesses, regions, and/or nations concentrate on goods and services that they can produce better than anyone else
Specialization
a business owned and operated by a single person
Sole Proprietorship
a negative balance
Deficit
a sole provider for a good or service
Monopoly
nonprofit service cooperative that accepts deposits, makes loans, and provides other financial services to members
Credit Union
an expense that changes depending on how much a business produces
Variable Cost
a system in which private citizens own most, if not all, of the means of production and decide how to use them within legislated limits
Capitalism
a business owned by two or more people
Partnership
the payment people or institutions receive when they lend money or allow someone else to use their money
Interest
economic side effect that affects an uninvolved third party
Externality
an account from which deposited money can be withdrawn at any time by writing a check
Checking Account
the alternative you face if you decide to do one thing rather than another
Trade-Off
economic system in which individuals and businesses are allowed to compete for profit with a minimum of government interference
Free Enterprise
type of business organization owned by many people but treated by law as though it were a person
Corporation
shares of a company held by an investor
Stock
a long-term increase in the general level of prices
Inflation
an account that pays interest on deposits but allows customers to withdraw money at any time
Savings Account
an economic system in which the major economic decisions are made by the central government
Command Economy
economic system where government should not interfere in the marketplace
Laissez-Faire Economics
situation in which union and company officials submit the issues they cannot agree on to a neutral third party for a final decision
Arbitration
interest-bearing certificate of agreement between a borrower and a lender
Bond
a period of declining economic activity lasting six or more months
Recession
manipulation of the money supply to affect the cost of credit, economic growth, and price stability
Monetary Policy