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76 Cards in this Set

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The inability to satisfy all wants at the same time
scarcity
People have to make choices because resources are _______
limited
Factors of production that are used in the production of goods and services are called __________
resources
Name four types of resources
natural, human, capital, entrepreneurship
That which is given up when a choice is made is called _______ ____
opportunity cost
The amount of money exchanged for a good or service is the _______
price
______ are used to change economic behavior
incentives
What determines price?
the interaction of supply and demand
the amount of a good or service that consumers are willing and able to buy at a certain price
demand
the amount of a good or service thta producers are willing and able to sell at a certain price
supply
making goods or providing services
production
what determines what is produced
resources available and consumer preferences
the using of goods and services is known as _______
consumption
what determines what is purchased?
consumer prefernce and price
Name three major economic systems
free market
command economy
mixed economy
what makes on type of economic system different from others
the extend of government involvement in economic decision making
Characteristics of a _______ _____ economy are private ownership of property and resources; profit; competition; consumer sovereignty and individual choice
free market
this economic system is the most common in the world today. the government plays a bigger roll that in a free market economy, but less of a role that in the commany economy
mixed economy
in a mixed economy individuals and business are the decision makers for the ____ sector, and government is decision maker in the ______ sector.
private--- public
a form of business organization with one owner who takes all the risks and all the profits
proptietorship
who does the economic decision- making in the U.S.
it's share by individuals, business and government
name five characterisitcs of the U.S. economy
free markets; private property; profit; competition; consumer sovereignty
one characteristic of the u.s. economy is free markets. this means:
markets are allowed to operate without undue interference from the government
one characteristic of the u.s. economy is private property. this means:
individuals and businesses have the right to own personal property as well as the means of production without undue interference from the government
one characteristic of the u.s. economy is profit. profit consists of:
earnings after all expenses have been paid
characteristics of a ____ economy are central ownership of property and resources; centrally-planed econmy; lack of consumer choice
command
what would be the benefit for a business owner of turning his business into a corporation
if the business fails, the owner won't lose his personal savings because his liability is limited to investment
in the u.s economy, what flows continuously among households, businesses and markets
resources, goods and services
what do individual and business savings do for the economy?
provide financial capital that can be borrowed for business expansion and increased consupmtion
businesses (producers) buy ______; make products that are sold individuals, other businesses, and the government; and use the profits to buy more ______.
resources--- resources
governments use _____ ______ from individuals and businesses to provide public gods and services.
tax revenue
how do financial institutions like banks encourage saving and investing?
private financial institutions act as intermediaries between savers and borrowers
what are some examples of private financial institutions
banks, savings and loans, credit unions, and securities brokerages
banks receive deposits and make ________.
loans
worldwide markets, buying and selling of goods and services by all nations.
global economy
why the united states trade with other nations
to increase wealth
why do states and nations trade?
to obtain goods and services the cannot produce or produce effieciently themselves
to buy goods and services at a lower costs or a lower opportunity cose
to sell goods and services to other countries
to create jobs
louisiana and the united states ______ in the production of certain goods and services
specialize
one characteristic of the u.s. economy in competition. this means-
rivalry between producers/sellers of a good or service results in better quality goods and services at a lower price
one characteristic of the u.s. economy is consumer sovereignty. this means:
consumers determine through purchases, what goods and services will be produced
free markets are markets that are allowed to operate without ______ ___ from the government.
undue interference
competition results in:
better quality goods and services at a lower price
in the U.s., who determines thorugh purchases, what goods and services will be produced?
consumers
a form of business organization with one owner who takes all the risks and all the profits
proprietorship
a form of business organization with tow or more owners who share the risks and the profits
partnership
a form of business organization that is authorized by law to act as a legal person regardless of the number of owners. owners sharethe profits. owner liability is limited to investment.
corporation
a person who takes a risk to produce goods and services in search of profit.
entrepreneur
in a proprietorship, who takes all the risks and all the profits?
a single owner
a business partnership has _____ ____ who share the risks and the profits?
two or more owners
a corporation is a from of business that is authorized by law, regardless of the number of owners, to act as:
a legal person
in which from of business is owner liability limited to investment?
corporation
what is the impact of technological innovation on world trade?
contribute to the golbal flow of information, captial, goods, and services; lowers the cost of producion
the government both promotes and regulates _______.
competition
how does the government promotes marketplace competition?
enforcing antitrust legislation to discourage the development of monopolies
engaging in global trade
supports business start-ups
the government promotes competition by enforcing ______ legislation to discourage the development of monopolies
antitrust
what are some examples of public goods and services?
interstate highways, postal service, and national defense
how do governments get the money to produce public goods and services?
through tax revenue and through borrowed funds
where does congress get the authority to tax personal and business incomes?
16th amendment
the government can ______, _____, and ______ to influence economic activity.
tax, borrow and spend
government _____ ______ reduce the funds for private and business spending.
tax increases
government _____ ____ increase funds for pricate and business spending.
tax decreases
increased government spending ______ demand, which may _____ employment and production.
increases, increase
___________ government spending reduces demand, which may result in a ______ of the economy
less, slowing
increased government spending may result in _____ taxes
higher
decreased government spending may result in ____ taxes
lower
the FED is the-
federal reserve system
the Fed is the _____ _____ of the United States.
central bank
the Fed regulates the
money supply
the reserve bank acts as a banker's bank by issuing currency and regulating the amount of ______ in circulation.
money
what does the Fed do to slow the economy?
the fed can restrict the money supply, causing interest rates to rise
why would the Fed incerase the money supply, causing interest rates to decline?
to stimulate the economy
what are three ways the Federal Reserve Bak can slow the economy?
increase in the reserce requirement; raise the discount rate; sell government securities
what are three ways the Federal Reserve Bank can stimulate the economy?
lower the reserve requirement; lowers the discount reate; purchases government securities
how does the U.S. government protect consumer rights and property rights
the government passes laws and creates agencies to protect consumer rights and property rights
how is public health and safety protected?
government agencies establish guidelines that protect public health and safety.
what kind of advancements create new jobs in the workplace?
technological advancements