Vocabulary
A good that is meant to last 3 years or more is a...
Durable good
People in Country C rarely engage in market transactions, they do not need to. Families grow their own vegetables and raise their own animals or hunt to get meat. Certain months are tough in Country C, especially the winters, but the people stock up in the “good months” and develop relationships with their neighbors with whom they share or trade.
What kind of economic system is this?
Traditional
What are the three basic questions answered by economics?
What
How
For whom
What is opportunity cost?
The value of the next best alternative
Which two groups spend money in the product market?
Households/Individuals
The Government
TINSTAAFL means...
There Is No Such Thing As A Free Lunch
In country B the people do not get to choose their line of work. The government decides where they work, when they work, and how much money they receive.
What kind of economic system is this?
Command
What two things does a good need to have value?
Scarcity and utility (usefulness)
When making a decision, you have to weigh what two things?
Cost and Benefits
Who makes money from the product market?
Businesses
Land, labor, capital, and entrepreneurs are considered the...
Factors of Production
My name is Megan Smith. My mom was a nurse, but I love clothes, because I love fashion, I decided to open a store. Hopefully someday, my store will become a very profitable chain of stores.
What kind of economic system is this?
Market
Free Market is also known as... (2 answers)
Free Enterprise
Pure capitalism
On her shopping trip for a new outfit Sara found a sweater and a pair of jeans she really wanted, unfortunately she only had enough money for one of the two items. After much thought she decided to buy the jeans and not the sweater.
What is the opportunity cost of her descision?
The sweater
What 4 things does the government do in the circular flow model?
Collect taxes
Give tax breaks
Charge Fees
Buy products
When something essential has a low cost and something non-essential has a high cost, it is known as...
Paradox of Value
Dan Johnson owns a string of auto repair shops in Texas. Every year State Inspectors show up to examine the working conditions of the shops, in order to ensure safety measures are being carried out by him and his employees.
What kind of economic system is this?
Mixed
The Great Depression (caused by a lack of consumer protections involving banks) is an example of the risks of what kind of economic system?
Pure market/pure capitalism
You have an economics test tomorrow. You can choose to go to sleep early or stay up all night. If you choose to stay up all night, what are the benefits given up?
A good nights rest before a test
Who ultimately decides what is produced?
Consumers
Specialization (one worker being very good at one specific task) is a type of...
Division of labor
The nationalization (owning by the government) of the major industries in Hugo Chavez's Venezuela is an example of movement from what kind of economy to what other kind of economy?
Movement from market/mixed to command
Which economic system is the United States CLOSEST to?
Market Economy
Why are there opportunity costs?
You are limited in the ways that you can use your time
Land earns...
Labor earns...
Capital earns...
Entrepreneurs earn...
Rent
Wages
Interest
Profit