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33 Cards in this Set
- Front
- Back
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Free Enterprise
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the system of business in which individuals are free to decide what to produce, how to produce it, and at what price to sell it.
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cultural (or workplace) Diversity
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differences among people in a workforce owing to race, ethnicity and gender.
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Business
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the organized effort of individuals to produce and sell, for a profit, the goods and services that satisfy society's needs.
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Profit
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what remains after all business expenses have been deducted from sales revenue.
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Stakeholders
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all the different people or groups of people who are affected by an organization's policies, decisions, and activities.
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Economics
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the study of how wealth is created and distributed.
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MICROeconomics
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the study of the decisions made by individuals and businesses.
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MACROeconomics
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the study of the national economy and the global economy.
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Economy
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the way in which people deal with the creation and distribution of wealth.
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Factors of production
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resources used to produce goods and services.
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Entrepreneur
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a person who risks time,effort, and money to start and operate a business.
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Capitalism
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an economic system in which individuals own and operate the majority of businesses that provide goods and services.
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Invisible hand
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A term created by Adam Smith to describe how an individual's personal gain benefits others and a nation's economy.
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Market economy
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An economic system in which businesses and individuals decide what to produce and buy, and the market determines the quantities sold and prices.
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Mixed economy
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An economy that exhibits elements of both capitalism and socialism
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Consumer products
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Goods and services purchased by individuals for personal consumption
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Command economy
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An economic system in which the government decides what goods and services to be produced, how they will be produced, for whom available goods and services will be produced, and who owns and controls major factors of production
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Gross domestic product (GDP)
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The total dollar value of all goods and services produced by all people within the boundaries of a country during one year period.
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Inflation
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A general rise in the level of prices
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Deflation
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He general decrease in the level of prices
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Unemployment rate
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The percentage of a nation's labor force unemployed at the time.
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Consumer Price Index (CPI)
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A monthly index that measures the changes in prices of a fixed basket of goods purchased by a typical consumer in an urban area.
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Producer price index (PPI)
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An index that measures prices that produces receive for their finished goods.
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Business cycle
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3 occurrence of periods of growth and recession in a nation's economic activity.
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Recession
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Two or more consecutive three month periods of decline in a country's GDP.
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Depression
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A severe recession that lasts longer than a typical recession and has a larger decline in business activity when compared to a recession.
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Monetary policies
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Federal Reserve decisions that determine the size of the supply of money in the nation and the level of interest rates.
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Fiscal policies
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Government influence on the amount of savings and expenditures; accomplished by altering the tax structure and by changing the level of government spending.
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Federal deficit
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A shortfall created when the federal government spends more in a fiscal year than it receives.
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National debt
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The total of all federal deficits
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Competition
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The rivalry among businesses for sales to potential customers.
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Perfect (or pure) competition
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the market situation in which there are many buyers and sellers of a product and no one single buyer or seller is powerful enough to affect the price of that product.
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Supply
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the quantity of a product that producers are willing to sell at each of various prices.
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