Unit 1: Fundamental Economic Concepts

Lakukan tugas rumah & ujian kamu dengan baik sekarang menggunakan Quizwiz!

Productive Resources/Factors of production

The scarce items used in the production of goods and services in an economy.

Entrepreneurship

Risking one's own financial resources to start a business in hopes of profit

Traditional economies

economy based on how things have been done for generations

Market economies/Capitalism

economy based on private ownership and the determination of prices by supply and demand

Command economies

economy in which the gov't makes all economic decisions

Economic Equity

fairness in the economy, whether from equal access, or from equal outcomes

Government deregulation

government decides to stop or lessen its involvement in a particular industry

Public goods and services

government provided goods/services for everyone to use

Allocation

how countries answer the for whom to produce question

Price stability

making sure that increases in the overall price levels are predictable and protect the purchasing power of money in the economy over time

Market failures

occurs when a private company or industry benefits from production for which other people end up paying some of the costs

Inputs

resources used in production

Production possibilities curve/frontier

shows the amount of one good or service sacrificed to produce additional units of the other good or service

Human capital

skills & knowledge of workers

Incentives

something that motivates individuals, businesses, and/or governments to take or avoid an action.

Government regulation

the extent to which a central authority has control over the production and consumption decisions in an economy.

Sustainability

the goal of individual countries to maintain an upward trend of real Gross Domestic Product growth over time

Standard of living

the material well-being people in an economy enjoy

Opportunity cost

the next best alternative given up when individuals, businesses, and governments confront scarcity by making choices.

Human resources (labor and human capital)

the people involved in the production of goods and services. People offer their time, physical abilities, knowledge, and skills.

Productivity

the ratio of inputs to outputs. the rate at which goods and services are produced

Physical capital

tools, machines, and structures used over and over again in the production of goods and services.

Division of labor

type of specialization which different workers do different parts of the same job

Investment

using resources that could bring immediate benefits for the purposes of gaining greater benefits

Full employment

All willing and able workers having the opportunity to do so; an unemployment rate between 4% and 6%.

Innovation

A way to improve efficiency or production, or a new invention.

Consumer sovereignty

Consumers' ability to buy what they want, which determines the goods and services in an economy.

Mixed economies

Have some characteristics of all three economies, but tend to lean toward one of the three.

Economic Security

How an economy protects individuals and businesses from risk.

Economic Growth

Increasing the production of goods and services over time.

Voluntary exchange

People/Businesses freely choosing to participate in market transactions

Rational decision making

Selecting a choice when the marginal benefits are equal to or greater than the marginal costs.

Economic Freedom

The ability of consumers, producers, and workers to make their own decisions about consumption, production, and distribution of goods and services.

Private ownership

The ability of individuals and businesses in an economy to buy, sell, and hold property as they wish without fear of government interference or seizure.

Marginal costs

The additional amount of effort, expense, or time one incurs from undertaking one more unit of an action.

Marginal benefits

The additional positive value one receives from undertaking one more unit of an action.

Natural Resources (land)

The gifts of nature we use to produce goods and services

Profit motive

The incentive of the extra money a business will receive in revenue after paying the costs of operating the business.

Specialization

When individuals or businesses concentrate on a single activity or an area of expertise when producing a good or service.

Economic Efficiency

When the factors of production are allocated to their most productive use.

Scarcity

a basic condition that exists when unlimited wants exceed limited productive resources

Competition

a struggle among businesses to gain customers

Trade-offs

act of giving up one thing of value to gain another

Outputs

amount of good/service produced


Set pelajaran terkait

13 Play Memorization: BRETT'S Lines

View Set

Anatomy & Physiology II Final Exam

View Set

Principles of Economics Module 1

View Set

COMPTIA A+ 220-1001: TROUBLESHOOTING PRINTERS

View Set

Marketing Final: Quizzes and Homework

View Set