Commerce

What is a market?

A market is one of the many varieties of systems, institutions, procedures, social relations and infrastructures whereby parties engage in exchange. While parties may exchange goods and services by barter, most markets rely on sellers offering their goods or services (including labor) in exchange for money from buyers.

Equilibrium

A point where supply and demand are balanced

Servises

Actions or activities that are performed for you (intangible) that can be bought. Ex: legal advise, hair cut, education

Land

Any natural resource provided by nature used in process of production. Ex: forests, minerals, oil, rivers, lake, etc. May be renewable or non-renewable

What is an economic system?

Economic systems are the means by which countries and governments distribute resources and trade goods and services. They are used to control the five factors of production, including: labor, capital, entrepreneurs, physical resources and information resources.

Law of Supply

Everything is equal, an increase in price results in an increase in quantity supplied. In other words, there is a direct relationship between price and quantity: quantities respond in the same direction as price changes.

Economics

It is the study of how society chooses to allocate its scarce resources to the production of goods and services in order to satisfy unlimited wants and needs

Capital

Its the physical part, machinery and equipment used to produce goods. That is man-made goods that do not directly satisfy human wants. Ex: buildings, production equipment, software, factories, etc.

Market Economy

Market encores are unplanned, it's an economy in which decisions regarding investment, production, and distribution are based on market determined supply and demand, and prices of goods and services are determined in a free price system.

Entrepreneurship

Organises and manages the resources needed to produce goods and services. The creative ability of individuals to manage the combination of resources to produce products

Planned Economy

Planned economies is organised by government officials who also own and direct the factors of production.

What does scarcity make us do?

Scarcity forces us to make choices - individuals, groups, businesses, government and societies never have as much goods and services as they would like to have.

Scarcity

Scarcity is the condition in which wants are forever greater than the available supply of resources.

Economic Problem

Scarcity, or limited resources, is one of the most basic economic problems we face. We run into scarcity because while resources are limited, we are a society with unlimited wants. Therefore, we have to choose.

How, and how much is produces?

Society must choose based on the recourses available, population size and level of demand.

Who chooses what is produced?

Society must choose based on what is needed. Consumers decide what is produced through their purchasing patterns and what is wanted and needed.

For whom to produce?

Society must chose based on it's population and other available markets

What is a black-market?

The black market is also the venue where highly controlled substances or products such as drugs and firearms are illegally traded. Black markets can take a toll on an economy, since they are shadow markets where economic activity is not recorded and taxes are not paid.

Wants

The goods and services that is consumed beyond what is necessary.

Law of demand

The law of demand is a microeconomic law that states, all other factors being equal, as the price of a good or service increases, consumer demand for the good or service will decrease, and vice versa.

Opportunity Cost

The loss of other alternatives when one alternative is chosen.

Labour

The mental and physical capacity of workers to produce goods and services. Ex: farmers, nurses, lawyers, teachers, etc.

Producers

The people who makes the things that satisfy consumers wants and need. They are after max profits and minimum costs

Consumer Sovereignty

The situation in an economy where the desires/wants and needs of consumers control the output of producers.

Goods

They are the physical objects that can be purchased. Ex: shoes, food, jewellery, iPhone

Needs

Those goods and services that are necessary for survival. Ex: food, clothing, shelter

Traditional Economy

Traditional economy is an original economic system in which traditions, customs, and beliefs shape the goods and the services the economy produces, as well as the rules and manner of their distribution.

What are the 3 economic questions?

What to produce, How to produce and For whom to produce

Resources

resources that are the basic categories of inputs used to produce goods and services. Recourses can also be called 'factors of production'.