Chapter 2 Tne U.s. And Global Economics

Front 1

Consumption goods and services

Back 1

goods and services that are bought by individuals and used to provide personal enjoyment and contribute to a person's quality of life

Front 2

Capital goods

Back 2

ggods that are bought by businesses to invrease their productive resources

Front 3

Government goods and services

Back 3

goods and services that are bought by the governments

Front 4

export goods and services

Back 4

goods and services that are produced in one country and sold in other countries

Front 5

factors of production

Back 5

the productive resources that are used to produce goods and services----land, labor, capital, and entrepreneurship

Front 6

land

Back 6

the "gifts of nature," or natural resources, that we use to produce goods and services

Front 7

labor

Back 7

the work time and work effort that people devote to producing goods and services

Front 8

human capital

Back 8

the knowledge and skill that people obtain from education, on-the-job training, and work experience

Front 9

capital

Back 9

tools, instruments, machines, buildings, and other items that have been produced in the past and that businesses now use to produce goods and services

Front 10

entrepreneurship

Back 10

the human resource that organizes labor, land, and capital

Front 11

rent

Back 11

income paid for the use of land

Front 12

wages

Back 12

income paid for the services of labor

Front 13

interest

Back 13

income paid for the use of capital

Front 14

profit or (loss)

Back 14

income earned by a entrepreneur for running a business

Front 15

functional distribution of income

Back 15

the distribution of income among the factors of production

Front 16

personal distribution of income

Back 16

the distribution of income among households

Front 17

circular flow model

Back 17

a model of the economy that shows the circular flow of expenditures and incomes that result from decision makers' choicces and the way those choices interact to determine what, how, and for whom goods and services are produced

Front 18

households

Back 18

individuals or groups of people living together

Front 19

firms

Back 19

the institutions that organize the production of goodds and services

Front 20

market

Back 20

any arrangement that brings buyers and sellers together and enables them to get information and do business with each other

Front 21

goods market

Back 21

morkets in which goods and services are bought and sold

Front 22

factor markets

Back 22

markets in which the services of factors of production are bought and sold

Front 23

national debt

Back 23

the total amount that the federal has borrowed to make expenditures that exceed tax revenue---to run a government budget deficit

Front 24

describe what, how, and for whom goods and services are produced in the United States

Back 24

consumtion goods and services represent 60% of total production; capital goods represent 14%;
goods and services are produced by using the services of four factors of production: land, labor, capital, and entrepreneurship
the incomes people earn determines who gets what is produced

Front 25

use the circular flow model to provide a picture of how households, firms, and governments interact

Back 25

circular flow model shows that real flows of factors of production and goods and the corresponding money flows if income and expenditures
governments in the circular flow receive taxes, make transfers, and buy goods and services
social security, medicare, medicaid, national defense, and homeland security are large components of the federal government's expenditures, interest on the national debt is also significant. Personal income taxes and social security taxes pay the largest share of these expenditures
education a, welfare benifits, and highways account for most of the expenditures of the state and local governments; and sales taxe, transfers from the federal government, and property taxes pay for these expenditures