Reading...
Play button
Play button
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;
155 Cards in this Set
- Front
- Back
|
factors of production
|
land, labor, capital, and management
|
|
|
physical capital
|
money, buildings and equiptment
|
|
|
scarcity
|
a limited # available-- everybody gets a certain #
|
|
|
the economic questions
|
What is to be produced?
How is it to be prodcued? Who is going to get it? How much is to be made? |
|
|
incentives
|
the outcome or expectation that encourages people to behave in a certain manner
|
|
|
free enterprise
|
private ownership
|
|
|
specialization
|
a concentration of productive efforts on a limited activity - specific job tasks
|
|
|
standard of living
|
a level of economic prosperity
|
|
|
gross domestic product (gdp)
|
value of goods and services produced IN the US
|
|
|
elasticity of demand
|
change in price compared to change in quantity of goods wanted
|
|
|
total cost
|
fixed cost + variable cost
|
|
|
elasticity of supply
|
change in price compared to change in quantity of goods offered
|
|
|
equilibrium
|
intersection of supply and demand - gives an equilibrium price and quantity
|
|
|
surplus
|
quantity supllied exceeds quantity demanded or also called excess supply
|
|
|
deregulation
|
to remove laws that effect businesses
|
|
|
economies of scale
|
those factors that cause a producer's average cost to fall as output increases
|
|
|
imperfect competition
|
a market structure that lacks one or more of the conditions of perfect competition
|
|
|
merger
|
two or more companies join together
|
|
|
monopoly
|
a market dominated by a single producer
|
|
|
monopolistic competition
|
a market structure with many companies selling similar but not identical products
|
|
|
partnership
|
business organization involving 2+ people
|
|
|
limited liability
|
only liable to the amount of your original investment
|
|
|
cooperative
|
business organization owned and operated by those who benefit from it
|
|
|
corporation
|
a separate legal business entity created by law - sometimes called artificial person
|
|
|
limited life
|
doesn't live long (partnerships)
|
|
|
sole proprietorship
|
single-owner business
|
|
|
umlimited liability
|
all partners are personally liable
|
|
|
collective bargaining
|
the worker and employer agree to negotiate any issues (salary, benefits, etc)
|
|
|
labor union
|
organization of workers who try to improve salary, working conditions, and job security
|
|
|
productivity
|
the value of output
|
|
|
barter
|
trading good for good, good for service, service for good, or service for service
|
|
|
cheap money (greenbacks)
|
paper money
|
|
|
currency
|
coin and paper money
|
|
|
hard money
|
coins
|
|
|
medium of exchange
|
used to determine the value of goods or services
|
|
|
money
|
anything that serves as a medium of exchange, a unit of value or a store of value
|
|
|
store of value
|
to identify value for the future
|
|
|
unit of value
|
used to compare the value of goods and services
|
|
|
bank
|
institution for receiving, keeping and lending money
|
|
|
discount rate
|
interest charged for the member banks to borrow from the Fed
|
|
|
FDIC
|
insures bank deposits up to $100,000 in case of bank failures. put in by Roosevelt
|
|
|
federal reserve system
|
1913; establishes a bank for the US and a bank for the other member banks
|
|
|
gold standard
|
financial system backed by a value of gold
|
|
|
prime rate
|
interest charged to best customers by member banks
|
|
|
checking accounts (demand deposits)
|
second level of liquidity
|
|
|
creditor
|
person who is owed money to
|
|
|
liquidity
|
how fast you can get money into cash
|
|
|
mortgage (principal + interest)
|
borrowing money for land, property, buildings or houses
|
|
|
near money (credit cards)
|
5th level of liquidity
|
|
|
savings account
|
3rd level of liquidity
|
|
|
time deposit (certificate of deposits)
|
4th level of liquidity
|
|
|
investments
|
process of directing resources that will create benefits in the future
|
|
|
portfolio
|
collection of your financial assets
|
|
|
corporate bond
|
bond issued by a corporation usually for growth and development
|
|
|
money market
|
investing in shoret term gov securities called treasury bills or treasury notes - usually last less than a year
|
|
|
municipal bond
|
issued by government unit (school, city, etc)
|
|
|
savings bond
|
issued by gov; pre-discounted and then matures to full value in a few years
|
|
|
capital gain/capital loss
|
profit or loss on an investment
|
|
|
dow jones (the dow)
|
financial news service of stock quotation
|
|
|
nasdaq-amex
|
quotation system for OTC stocks
|
|
|
otc market
|
over the counter, unlisted stocks
|
|
|
share/stock
|
ownership in a corporation
|
|
|
stock exchange
|
NYSE and AMEX are examples
|
|
|
aggregate supply/demand
|
total value of goods and services offered/wanted at all prices
|
|
|
gross national product (gnp)
|
total value of goods and services produced by American companies (including in foreign nations)
|
|
|
nominal gdp
|
also called current gdp - computing gdp in current dollar value
|
|
|
real gdp
|
adjusting gdp for inflation
|
|
|
depression
|
total collapse of the economy
|
|
|
leading indicators
|
housing permits, early warnings
|
|
|
recession
|
a decline or slowdown in the economy
|
|
|
stagflation
|
decline in GDP and increase in inflation and prices - a stagnant economy
|
|
|
real gdp per capita
|
adjusted gdp divided by the population
|
|
|
saving
|
income not used for consumption
|
|
|
cyclical unemployment
|
people are laid off because of a slowdown in the economy
|
|
|
frictional unemployment
|
between jobs
|
|
|
full employment/unemployment rate
|
unemployment rate is 5% or less=full employment
|
|
|
seasonal unemployment
|
between jobs because of harvesting seasons
|
|
|
structural unemployment
|
not having the job skills to work
|
|
|
consumer price index
|
a specific price index comparing a group of products from the past to present
|
|
|
cost-push inflation
|
increased production will push prices upward
|
|
|
deflation
|
declining spiral or prices and wages
|
|
|
demand-pull inflation
|
more demand than supply available, prices will be pulled upward
|
|
|
inflation/inflation rate
|
rising spiral of wages and prices - try to keep under 10%
|
|
|
price index
|
measurement to show prices of goods and services over a period of time
|
|
|
income distribution
|
how the income is distributed across the society
|
|
|
poverty level
|
$13-14000/year
|
|
|
corporate income tax
|
tax on a corporation's income
|
|
|
individual income tax
|
a tax on a person's individual income
|
|
|
progressive tax
|
a tax that the more you make, the more you pay
|
|
|
property tax
|
tax on land and buildings
|
|
|
proportional tax
|
everybody pays the same % regardless of income
|
|
|
regressive tax
|
the more you make, the less you pay by %
|
|
|
sales tax
|
a tax on goods and services
|
|
|
tax
|
a required payment by the government
|
|
|
estate tax
|
a tax on a deceased person's assets
|
|
|
medicare
|
a medical assistance program for those over 65
|
|
|
social security (FICA)
|
a retirement pension program by the government
|
|
|
tariff
|
tax on an imported good
|
|
|
tax return
|
documents you file to pay taxes
|
|
|
withholding
|
method used to collect taxes out of your paycheck
|
|
|
discretionary spending
|
spending by the gov where they have a choice
|
|
|
mandatory spending
|
required spending by the government
|
|
|
medicaid
|
medical aid program for the eldery and poor
|
|
|
balanced budget
|
income=spending
|
|
|
personal property
|
personal items
|
|
|
real property
|
land and buildings
|
|
|
tax assessor
|
government official who decides the value of your propoerty for tax purposes
|
|
|
appropriations bill
|
bill that allows money to be spent by Congress
|
|
|
federal budget
|
spends the money and receives money
|
|
|
fiscal policy
|
gov policy on spending and income
|
|
|
OMB
|
executive office agency that prepares the budget
|
|
|
automatic stabilizer
|
gov. programs that stabilize the economy
|
|
|
demand-side economics (keynesian)
|
a theory that gov spending and tax cuts increase demand
|
|
|
multiplier effect
|
economic concept that by spending $, it multiplies itself into the economy
|
|
|
supply-side economics
|
gov theory that tax cuts alone will raise consumer supply
|
|
|
budget surplus
|
take in more than you spend
|
|
|
crowding-out effect
|
procedure by the gov. securities to slow down money supply
|
|
|
national debt
|
the money the US has borrowed from itself
|
|
|
treasury (bill, bond, note)
|
all examples of gov. securities; slow down money supply
|
|
|
budget deficit
|
spend more than you take in
|
|
|
board of governors
|
policy of federal reserve
|
|
|
federal open market committee (FOMC)
|
decides interest rates
|
|
|
federal reserve districts
|
12 of these
|
|
|
monetary policy
|
the gov. policy toward money supply
|
|
|
serving banks function
|
bank for member banks
|
|
|
serving government function
|
bank for US gov
|
|
|
open market operations
|
gov. buying and selling securities
|
|
|
required reserve ratio
|
how much a bank must hold of your deposit
|
|
|
reserve requirements
|
the ratio of what they have to keep & lend
|
|
|
easy money policy
|
the money supply is open, interest rates down, gov. buying back bonds
|
|
|
tight money policy
|
gov. sells securities and interest rates go up
|
|
|
absolute advantage
|
one country can produce goods and services better than any other
|
|
|
comparative advantage
|
one country can offer a better price based on opportunity cost
|
|
|
export
|
what is shipped out
|
|
|
import
|
what is shippied in
|
|
|
euro
|
currency of the European Union
|
|
|
free-trade
|
trade without restriction, tariffs or quotas
|
|
|
import quota
|
limiting the # of units of a product that can come into the country
|
|
|
NAFTA
|
North Atlantic Free Trade Agreement - no trade restrictions between Canada, US, Mexico
|
|
|
protectionism
|
protecting American products against unfair foreign competition
|
|
|
World Trade Organization (WTO)
|
removes trade and tariff restrictions
|
|
|
appreciation/depreciation
|
one money has gained/declined in value to another
|
|
|
balance of trade
|
relationship of a country's imports to their exports
|
|
|
exchange rate
|
value of one country's currency to another's
|
|
|
foreign exchange market
|
marketplace for buying and selling currency
|
|
|
trade deficit/surplus
|
importing more than exporting, or exporting more than importing
|
|
|
infrastructure, life expectancy, literacy rate, mortality rate
|
areas of development
|
|
|
population growth
|
% of growth
|
|
|
subsistence agriculture
|
produce enough food for only your people
|
|
|
resource distribution
|
how resources/assistance is being shared
|
|
|
international monetary fund
|
IMF - stabilize exchange rates of money
|
|
|
united nations development program
|
UNDP - works toward the elimination of poverty
|
|
|
world bank
|
largest provider of assistance around the world
|
|
|
privatization
|
changing a gov-owned business into a privately-owned one
|
|
|
special economic zones
|
In China - zones that allow investment in some, no investment in others
|
