Economy Test-7th Grade

Productive resources

Factors of production ( parts ) used to make or deliver of goods and services, Can be natural, capital or entrepreneurship.

Financial Capital Market

Financial institutions encourage individuals and businesses to saveand invest by offering interest on deposits use for loans borrowed by businesses

Institutions

Formal organizations, customary ways, controlling values, beliefs, and cultural traditions that shape and reflect how societies operate.

Controlling values

Freedom, efficiency, equity security, full employment, stability, growth

Natural Resources

Gifts of nature example, land, lumbar, animals, used to make goods and services.

How does the government fit into a model of circular flow

Government use tax revenues from individuals and businesses to provide public goods and services

Society

Group of people living in a particular place.

Resource market

Household so resources to businesses for income

Who buys and sells in the product market

Household use income to buy goods and services (products) produced by businesses

Economic institutions

Households, businesses, labor unions, money mints, regulating agencies.

Demand

The amount of a good or service that consumers are willing and able to buy at a certain price

Supply

The amount of a good or service that producers are willing and able to sell at a certain price

Economy

The production, exchange, and conception of scarce goods and services in a given area.

Choices

The selection of an item or action from a set of possible alternatives.

Economics

The study of how individuals and societies choose to use scarce productive resources to obtain goods and services.

Consumption

The use of goods and services to satisfy needs and wants.

Customary ways

Using money, dominance of men and certain occupations, observance of various holidays.

What three basic questions do economic system seek to answer

What will be produced, who will produce it, for whom will it be produced.

Equailibrium price

Where supply and demand are equal at prices

Cultural traditions

Worth ethic, religion

Production

Combining of human, natural, capital and entrepreneurship resources to make goods services; available resources and consumer preferences determine what is produced.

Economic system

A collection of institution (parts) that provide a framework for a societies economic decision-making.

Proprietorship

A form of business organization with one owner who takes all the risk it all the profits

Partnership

A form of business organization with two or more or owners who share the risk and the profits.

Entrepreneur

A person who takes a risk to produce and sell goods and services in a search of profit.

Services

Actions, work, that can be bought and sold.

Government institutions

Constitution, Congress, the president, the Supreme Court, federalism, rule of law, consent of the governed, and dependency.

Scarcity

All resources and get a limited which requires that choice to be made the inability to satisfy our wants and needs at the same time.

Market

Any structure that allows buyers and sellers to make exchanges

Financial capital resources

Anything in measurable and money, example money, loans, investment. (used to make or provide access to other goods and services.)

Financial institutions

Banks, savings and loans, credit unions

Capital goods

Buildings, tools, machinery and other manufacturers or constructed things used to produce or provide access to other goods and services

Producers

Individuals or groups who make goods and services to satisfy consumer's wants and needs.

Corporation

It's for a business organization that is authorized by law to act as a legal entity; Owners share the profits, owner liability is limited to the amount of their investment

Interest

Money paid regularly at a particular rate and exchange for the temporarily use of lent money

Deposit

Money place in a bank, usually to gain interest

Income

Money received through work or investment

Loan

Money that is lended to a borrower in exchange for interest

System

Parts that work together as a whole

Consumers

People who use goods and services to satisfy needs and wants.

Human resources

People, when they perform any activity for which another person will pay.

Goods

Physical products, items, that can be bought and sold

What kind of economy is the us

Primarily a free market economy, government is involved in small quantities, therefore it is a mixed economy

Legal institutions

Private ownership your property, rights protected by negotiated contracts that are enforceable by law

Circular flow model

Provides a simplified overview of how a market economy operates

Two characteristics of traditional economies

•Economic decisions I'm done custom and historical precedent. •children perform the same type of work as their parents and grandparents

Three characteristics of command economies

•central ownership (usually by gov. Of property/resources •centrally planned economy •lack of consumer choice

Three ways the government pays for the goods and services it provides

•fear borrowed funds •through tax revenue •through fees

Three Characteristics of mixed economies

•individuals and businesses owners, decision-makers, for the private sector •Government is owner decision-maker for the public sector •governments role is greater then in a free market economy and less than in a command economy

Six characteristics of free market economies

•private ownership of property/resources •Profit motive example wanting to make gains •Competition •consumer sovereignty example consumer preferences determine what is produced •individual choice •minimal government involvement in the economy

Three organizational structures businesses take

•proprietorship •partnership •Corporation