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15 Cards in this Set
- Front
- Back
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What is the Law of Demand?
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Law of Demand-as the price of a good increases, the quantity of the good demanded falls.
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What is the Law of Supply?
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Law of Supply- as the price of a good rises, producers are willing to supply more of the good.
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What is the business cycle?
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Business Cycle- expansion and contraction by many industries at once.
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What are the two phases of the business cycle?
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Expansionary and Contractionary phases.
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What is economic expansion?
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Economic Expansion-occurs when consumer spending is strong and companies invest in new factories and equipment?
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What is the contractionary phase?
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Occurs when consumers reduce their purchases and business investment slows.
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What are exports?
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Exports-are a huge source of revenue for many companies and it is what is sent out from that country.
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What are imports?
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Imports are goods that are brought in from another country.
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What are inputs?
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They are land, labor, and capital.
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What is the law of comparative advantage?
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producers whould produce the goods they are most efficient at producing and purchase from others the goods they are less efficient in producing.
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What is trade surplus?
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Occurs when a country exports more than imports.
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What is trade deficit?
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Occurs when a country imports more than it exports.
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What is the foreign exchange?
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Foreign Exchange-if a country purchases goods/services from other countries, it must pay for them with foreign currency.
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What is a global economy?
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Global Economy-an economy in which companies compete actively with business from all over the world.
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What factors have led to the rise of the Global Economy?
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improvements in technology, political changes and free trade.
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