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26 Cards in this Set
- Front
- Back
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profit motive
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the force that encourages people and organizations to improve their material well-being.
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open oppurtunity
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the concept that everyone can compete in the marketplace.
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legal equality
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the concept of giving everyone the same legal rights.
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private property rights
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the concept that people have the right and privelege to control their possessions as they wish.
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free contract
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the concept that people may decide what agreements they want to enter into.
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voluntary exchange
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the concept that people may decide what and when they want to buy and sell.
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competition
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the rivalry among sellers to attract costumers while lowering costs.
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interest group
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a private organization that tries to persuade public officials to act or vote according to group members interests.
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public disclosure laws
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laws requiring companies to provide full information about their products.
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public interest
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the concerns of the public as a whole
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macroeconomics
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the study of the behavior and decision making of entire economies.
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microeconomics
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the study of the economic behavior and decision making of small units, such as individuals, families and businesses.
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gross domestic product (GDP)
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the total value of all final goods and services produced in a particular economy.
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business cycle
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a period of macroeconomic expansion followed by a period of contraction.
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work ethic
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a commitment to the value of work and purposeful activity.
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technology
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the process used to produce a good or service.
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public good
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a shared good or service for which it would be impractical to make consumers pay individually and to exclude nonpayers.
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public sector
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the part of the economy that involves the transactions of the government.
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private sector
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the part of the economy that involves the transactions of individuals and businesses.
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free rider
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someone who would not choose to pay for a certain good or service, but who would get the benefits of it anyway if it were provided as a public good.
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market failure
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a situation in which the market does not distribute resources efficiently.
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externality
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an economic side effect of a good or service that generates benefits or costs to someone other than the person deciding how much to produce or consume.
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poverty threshold
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an income level below that which is needed to support families or households.
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welfare
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government aid to the poor.
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cash transfers
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direct payments of money to eligible poor people.
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in-kind benefits
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goods and services provieded for free or at greatly reduced prices.
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