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32 Cards in this Set
- Front
- Back
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GDP
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total value of all goods and services produced in a country in one year
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3 factors of production
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natural resources, human resources or capital, capital resources or physical capital
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physical capital
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goods (such as machines or tools); land and buildings that are used in production and transportation of goods
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human capital
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investing in the developing education of workers/people (e.g. employee, employer, employment, salary (employee health programs)
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natural resources
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renewable & non-renewable; conservation- saving the supply of natural resources
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entrepreneur/entrepreneurship
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an individual who owns, organizes, and manages a business and in doing so, takes risks
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economics
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the study of how a society produces and distributes material
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three questions used to determine an economic system:
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1) what goods & services will be produced?
2) how will goods & services be produced? 3) who will consume the goods & services? |
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tariffs
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a tax on imported goods
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trade barriers
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anything that slows down or reduces trade, such as tariffs, quotas, embargoes, and scarcities
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quota
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1) a limit placed on the number of imports that may enter a country
2) the number of goods to produce in a specific period of time |
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embargo
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a government order stopping trade with another country. an order might be put in place to put pressure on another country.
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scarcity
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limited supply of goods
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types of economies
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market economy, command economy, mixed economy, traditional economy
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market economy
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laissez-faire role of government. it means that the government should not interfere in economic affairs. markets determine price and allocate resources. (supply & demand) free market, capitalism
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command economy
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the government controls the economy. the government determines 1) what to produce, 2) who will produce it, 3) how it will be produced, 4) for whom it will be produced
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mixed economy
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a system where mostly people/citizens decide what to produce, how to produce it, and how to set prices based on supply and demand. government does regulate some industry. most economies are mixed today, including the US, UK, russia and germany.
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traditional economy
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an economic system that is guided by the customs and habits of the past
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the higher a country's GDP...
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USUALLY the healthier the economy
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in nations with a higher GDP...
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USUALLY the standard of living is higher
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the higher the literacy rate...
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USUALLY the higher the GDP
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to increase the GDP...
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countries MUST invest in human capital
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to improve human capital...
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a country MUST invest in their people and provide education, training, skills, and health care to the people of the country
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having natural resources...
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HELPS the country produce its own goods and services. advantages: it can use its own natural resources to supply the needs of its people and use the natural resources to create goods that can be traded to other countries.
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gross domestic product per capita
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GDP per person. to calculate: divide the country's GDP by its population to get the GDP per capital
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currency
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money used in countries to pay for goods and services
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what happens if you want to buy something and you're in a different country?
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you must exchange your money for that different country's money. often, banks will charge a fee to exchange currencies.
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what happens if you're in a country that's a member of the European Union?
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if your country is a member of the EU and so is the different country, then you can use the same currency, the euro. but if your country is not a member, then you will have to exchange your currency to the euro.
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EU countries use the Euro; is this true for all EU member countries?
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no, there are three EU member countries that still use their own currency as their official currency and not the euro. the UK, for example, has the queen on their official currency to honor her, so they don't want to change it.
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producers
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people who make/sell/distribute goods or services
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consumers
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people who buy/purchase the goods or services
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resources
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things used to make goods and services
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