Q3
Centrally planned economy
A system in which the society's leaders, usually members of the central government, make _____ economic decisions
Authoritarian
A system which requires absolute _____ to leadership, often one leader personally
Market demand schedule
A table that shows how much of a good or service _____ consumers are willing and able to buy at each price in a market
Market supply schedule
A table that shows how much of a good or service all _____ are willing and able to offer for sale at each price in a market
Demand schedule
A table that shows how much of a good or service an individual consumer is will and able to purchase at each _____ in a market
Supply schedule
A table that shows how much of a good or service an individual producer is will and able to offer for sale at each _____ in a market
Voluntary exchange
A trade in which the parties involved anticipate that their personal benefits will _____ their cost(s)
Positive economics
A way of describing and explaining economics as it is, _____ as it should be
Normative economics
A way of describing and explaining what economic behavior _____ to be, not what it actually is
Product market
The _____ for goods and services, the market most recognized by consumers
Open opportunity
The ability of everyone to enter and compete in the marketplace of personal free _____
Economics
The study of how people choose to use scarce resources to satisfy their _____
Macroeconomics
The study of the behavior of an economy as a whole, involving inflation, _____, aggregate demand, and aggregate supply
Microeconomics
The study of the behavior of individual players, such as individuals, families, and businesses, _____ an economy
Services
Work that one person performs for another in exchange for _____
Specialization
A situation in which people concentrate their efforts in the areas in which they have an _____
Free contract
A situation in which people decide for themselves which legal _____ to enter into
Laissez faire
A French phrase, 'leave things alone,' associated with Jefferson's belief that the government that governs least governs best, or that there is no _____ for government involvement
Statistics
A branch of mathematics dealing with numerical _____ collection, organization, analysis, interpretation, and presentation
Market failure
A situation in which people who are not part of a marketplace interaction benefit from it or _____ part of its costs
Subsidy
A government payment that helps cover the cost of an economic activity that is considered to be in the _____ interest
Market demand curve
A graph that shows all the data found in the _____ demand schedule
Demand curve
A graph that shows how much of a good or service an _____ will buy at each price
Supply curve
A graph that shows how much of a good or service an individual _____ is willing and able to offer for sale at each price
Market supply curve
A graph that shows the data from the market _____ schedule
Production possibilities curve (PPC)
A graph used to show the maximum number of goods or services that can be produced using _____ resources
Total revenue test
A measure of elasticity that compares the total revenue a business would receive when offering its products at _____ prices
Elasticity of demand
A measure of how _____ consumers are to price changes in the marketplace
Modified free enterprise economy
A mixed economy which includes some government protections, provisions, and regulations to _____ the completely free enterprise system
Circular flow model
A model that visualizes how all interactions of the two key economic _____ makers, households and businesses, occur
Public transfer payment
A payment in which the government transfers income from taxpayers to recipients who do not pay _____ in return
Free rider
A person who does not pay for a good or service but who benefits from it when it is _____
Producer
A person who makes goods or provides _____
Externality
A side effect of a transaction that _____ someone other than the producer or buyer
Legal equity
A situation in which everyone has the same economic rights under the _____
Global economy
All the economic interactions that cross _____ boundaries
Land
All the natural _____ found on or under the ground that are used to produce goods and services, including water, forests, minerals, and wildlife
Capital
All the resources made and used by people to _____ and distribute goods and services
Change in demand
Also called a shift in demand, this type of change in the marketplace is caused by a change income, market size, consumer tastes, consumer expectations, substitute or _____ products
Capitalism
An economic system based on _____ ownership of the factors of production
Market economy
An economic system based on individual _____, not government directives
Traditional economy
An economic system in which families, clans, or tribes make economic decisions based on customs and beliefs that have been handed down through _____s
Socialism
An economic system in which the government _____ some or all of the factors of production
Command economy
An economic system in which the government decides what and _____ goods and services will be produced and distributed
Communism
An economic system in which the government owns all of the factors of production, and there is no _____ ownership of property; according to the textbook, also with little to no political freedom
Mixed economy
An economic system that has elements of market economies and planned economies, the most _____ type
Positive externality
An externality that is a _____ effect, or benefit, for people who were not involved in the original economic activity; for example, one of your neighbors maintains a beautiful rose garden, and all the surrounding homes benefit from the beauty
Negative externality
An externality that is a _____ effect, or cost, for people who were not involved in the original economic activity; for example, one of your neighbor's rock band practices loudly late at night, and all the surrounding homes suffer from the noise
Free enterprise system
Another term for _____, in which anyone is free to start a business or enterprise
Market
Any place or situation in which people buy and sell resources, _____, and/or services
Law of increasing opportunity costs
As shown by the PPC, as production switches from one product to another, increasingly more resources are needed to increase the production of the second product, which causes opportunity costs to _____
Incentives
Benefits offered to encourage people to act in _____ ways
Wants
Desires that can be _____ by consuming a good or service
Cost-benefit analysis
Examination of the costs and expected benefits of a _____
Profit
Financial _____ from a business transaction
Public goods
Goods and services that are provided by the government and _____ by the public
Substitutes
Goods and services that can be used in place of original items and demand for which rises when their prices _____ relative to the originals
Inferior goods
Goods that consumers demand _____ of when their incomes rise
Normal goods
Goods that consumers demand _____ of when their incomes rise
Safety net
Government programs designed to protect people from economic _____
Goods
Physical _____ that can be purchased, such as food, clothing, and furniture
Economic models
Simplified representations of _____ economic activities or problems
Trade off
The alternative given up when making an economic _____
Total revenue
The amount of _____ a company receives for selling its products or services
Utility
The benefit or satisfaction gained from the _____ of a good or service
Marginal benefit
The benefit or satisfaction received from using one _____ unit of a good or service
Change in quantity demanded
The change in the amount of a product consumers will buy because of a change in _____
Income effect
The change in the amount of a product that a consumer will buy because personal purchasing power changes, even though the income itself does _____ change
Entrepreneurship
The combination of vision, skill, ingenuity, and willingness to take risks that is needed to create and run new businesses, typically through _____ in developing new products, services, methods or production, distribution, or marketing
Efficiency
The condition in which economic resources are being used to produce the _____ amount of goods and services
Underutilization
The condition in which economic resources are not being used to their full _____
Marginal cost
The cost of using _____ more unit of a good or service
Demand
The desire to have some good or service and the ability to _____ for it
Law of supply
The economic principle that producers are willing to sell _____ of a good or service at a higher price than they are a lower price
Law of demand
The economic principle that when the price of a good or service fall, consumers buy _____ of it
Factors of production
The economic resources needed to _____ goods and services
Law of diminishing marginal utility
The economics principle that states the marginal benefit from using each additional unit of a good or service in a given time period tends to _____ as each is used
Competition
The effort of two or more people, acting independently, to get the business of others by offering the best _____
Infrastructure
The goods and services that are necessary for the smooth _____ of society, such as highways, power and water systems, education and health care systems, plus police and fire protection
Scarcity
The situation that exists when there are not enough resources to meet human _____
Labor
The human time, effort, and talent that go into the making of _____
Consumer sovereignty
The idea that because consumers are free to purchase what they want and refuse the products they don't want they have ultimate _____ over what is produced
Profit motive
The incentive that encourages people and organizations to improve their material well-being be seeking to gain from _____ activities
Elastic
The kind of demand for which a change in demand causes a relatively _____ change in the quantity demanded
Inelastic
The kind of demand for which a change in demand causes a relatively smaller change in the quantity _____
Unit elastic
The kind of demand for which the percentage change in price and quantity demanded are the _____
Private property rights
The legal ability for people to personally possess objects, their _____, and personal intellectual achievements as their own and to exchange them with others upon agreement
Factor market
The market for factors of _____: land, labor, capital, and entrepreneurship
Profit
The money left over after the costs of producing a product are _____ from the revenue gained by selling that product; financial _____ from a business transaction
Substitution effect
The pattern of behavior that occurs when consumers react to a change in the price of a good or service by buying a substitute product, one whose price has not changed but which offers a better _____
Consumer
The person who _____ goods or services for personal use
Opportunity cost
The value of the next-best _____, given up when choosing one alternative over another
Economic system
The way a society uses its scarce resources to satisfy its people's _____ wants
Supply
The willingness and ability to offer _____ for sale
Needs
Things such as food, clothing, and shelter, that are necessary for _____
Privatize
To change from government or public ownership of a resource or factor of production from to _____ ownership
Nationalize
To change from private ownership of a resource or factor of production from private to government or public _____
Economize
To make _____ according to analysis of the best combination of costs and benefits
Transfer payment
Transfers of income from one person or group to another even though the receiver does not provide any goods or services in _____
Complements
Two (or more) products which work in _____ with each other and increasing demand for one increases the demand for the other