Scarcity
Define Scarcity.
A shortage of goods or resources; a limited supply
Who makes the decisions in a Command Economy? Market Economy?
Command = Government
Market = Businesses and consumers
If new technology is created that makes it cheaper and easier to make the product, what will happen to the supply of that item?
There will be more supply.
When making a decision about what to buy, what is the list of everything else you could buy with the same amount of money called?
Trade offs
Which type of economy is going to have more options for consumers: Command or Market (free enterprise)?
Market/free enterprise
What is equilibrium?
The point where supply and demand meet; No shortage or surplus
When making decisions, what is the next best alternative called?
Opportunity cost
What is a monopoly?
When one company is the only creator/seller or a good/service.
When demand or supply decreases, in what way does it shift on a demand or supply curve?
To the left. Left = less; Right = more
In a market economy, what is the biggest incentive for people to become an entrepreneur (start their own business)?
To make a profit on what they invest in
If the price of one complement good goes down, what happens to the demand of the other?
It goes up.
Why might a market economy have poor working conditions?
There is no government intervention to provide protections for workers.
If the price of an original good goes down, what happens to the demand of the substitute good?
It will go down