Use LEFT and RIGHT arrow keys to navigate between flashcards;
Use UP and DOWN arrow keys to flip the card;
H to show hint;
A reads text to speech;
69 Cards in this Set
- Front
- Back
Need |
Something required for a person to live. (Food, Shelter, etc.) |
|
Want |
Something that isn't necessary for survival but is still desirable (TV, Nice Clothes, etc.) |
|
Economics |
The study of decision making |
|
Goods |
Physical items produced by people to be consumed by others. |
|
Services |
Actions performed for others with expectation of compensation. |
|
Scarcity |
When desirable resources are limited in quantity. |
|
Shortage |
When there is less of a desired good or service than is expected. |
|
Factors of Production |
The elements that come together to form a completed product. |
|
Land |
Unmodified natural resources (Unfiltered water, coal, ground.) |
|
Labor |
Effort provided by people to produce something. |
|
Capital |
The items or skills that are utilized by a person or business to make a product. |
|
Physical Capital |
Objects that in some way aid the production of finished goods; machinery. |
|
Human Capital |
Knowledge or skills of workers. |
|
Entrepreneur |
The person who puts the factors of production together in order to start a business. |
|
Trade-Off |
When one option is given up in favor of another. |
|
Guns or Butter |
An all or nothing decision. Derived from a nation's decision to focus on militarism or agriculturalism. |
|
Opportunity Cost |
The next best alternative given up in a trade-off. |
|
Thinking at the Margin |
Considering the efficiency of a decision at every possible increment. |
|
Productions Possibility Curve |
A graph that depicts the most efficient production of multiple goods. |
|
Productions Possibility Frontier |
The edge of the PPC that represents maximum efficiency. |
|
Efficiency |
How fully resources are used in the creation of a product; how much is wasted. |
|
Underutilization |
When efficiency is not at its peak, making less than you can. |
|
Cost |
What is given up to produce something. |
|
Law of Increasing Cost |
To keep your rate of production constant, you must increase the amount of resources used. |
|
Economic System |
The basic guidelines as to how a group makes economic decisions. |
|
Standard of Living |
The level of wealth, comfort, and prosperity within a given group. |
|
Traditional Economy |
An economic system based on precedent and ritual. |
|
Market Economy |
An economic system with little to no government involvement in economic decisions. |
|
Centrally Planned Economy |
An economic system in which all economic decisions are controlled by the government. |
|
Command Economy |
Same as a Centrally Planned Economy. |
|
Mixed Economy |
A mix of aspects from both Market and Command Economies. Some government involvement and some freedom. |
|
Market |
A place, literal or figurative, where buyers and sellers can trade goods. |
|
Specialization |
Limiting production to only certain products. |
|
Profit |
When what you gain from selling a product or service is above the cost of developing it. |
|
Self-Interest |
An interest in someone's own economic gain. |
|
Incentive |
An expectation that motivates people to act a certain way. |
|
Competition |
Struggle between sellers to attract the most buyers. |
|
Invisible Hand |
Self-regulating nature of the market. |
|
Socialism |
Democratically instituted command economy in which wealth is intended to be distributed evenly. |
|
Communism |
Command economy instituted by a forceful uprising of working-class people. |
|
Vladimir Lenin |
The founder of communism in Russia and in turn, the USSR. |
|
Authoritarian |
A governmental philosophy requiring strict adherence to rules. |
|
Laissez-Faire |
An economic philosophy proposing that governments relinquish all influence in their nation's economic markets. |
|
Private Property |
Property owned by individuals, not the government. |
|
Free Enterprise |
Private ownership of capital goods. |
|
Privatize |
Selling governmental institutions to private owners. |
|
Karl Marx |
The founder of communism. |
|
Adam Smith |
The creator of Laissez-faire capitalism |
|
Profit Motive |
Financial gain made in a transaction. |
|
Free Contract |
People decide which arrangements they enter into. |
|
Voluntary Exchange |
People decide what they buy and sell. |
|
Interest Group |
An organization that speaks on behalf of a group of people. |
|
Public Disclosure Laws |
Laws requiring companies to provide full and true information about their products. |
|
Public Interest |
Concerns of people as a whole. |
|
Macroeconomics |
The study of how people in general make economic decisions. |
|
Microeconomics |
The study of how small groups or individuals make economic decisions. |
|
Gross Domestic Product |
The total value of all goods and services produced within a nation. |
|
Business Cycle |
A repetitive pattern of economic expansion and contraction. |
|
Work Ethic |
A commitment to the quality of the product you produce. |
|
Public Good |
A good or service which must be provided for free. |
|
Public Sector |
Part of the economy which includes individuals and companies. |
|
Private Sector |
Part of the economy composed of the government. |
|
Free Rider |
People benefiting from goods or services provided as public goods for other people. |
|
Market Failure |
When the distribution of wealth in a market is not equal. |
|
Externality |
Effects of economic decisions on those they were not intended for. |
|
Poverty Threshold |
The amount of money deemed necessary for a person's survival. |
|
Welfare |
Government aid for those in poverty. |
|
Cash Transfers |
Welfare through direct monetary allotments. |
|
In-Kind Benefits |
Welfare through the provision of goods or services. |