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53 Cards in this Set
- Front
- Back
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What is economics?
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The study of economical activity.
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What is economical activity?
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Everything we do to meet our needs & wants and to improve our qualities of life.
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What are the parts of Economical Structure?
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They are land, capital, technology, and labour.
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When it comes to economical activity, some factors are limited. Why?
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The ability to get what we want is limited. It is limited by money, time, energy/drive, and opportunity.
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What is unlimited, at least where economical activity is concerned?
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Our needs and wants are unlimited.
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What are the 4 Categories of Economic Activity?
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The Money, Formal, Informal, and Non-Money Economies.
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What is money economy?
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Economy where money is involved.
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What is non-money economy?
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Economy where money is not involved.
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What is formal economy?
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Economy where transactions of money that are recorded occur.
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What is the private sector (subdivision of formal economy)?
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Formal economy that pays taxes (that is not directly related to the government, thus must pay them tax).
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What is the public sector (subdivision of formal economy)?
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Formal economy that does not pay taxes (that is completely run by the government).
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What are examples of private and public sectors?
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Some examples of private sectors are private companies and industries, e.g. banks, restaurants, department stores. Some examples of public sectors are jobs that are run & funded by the government, e.g. the army, police, hospital employees.
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What is informal economy?
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Economy where transactions of money that are not recorded occur.
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What is material wealth?
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Things that we can touch/own/buy, e.g. clothes, food, etc.
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What is non-material wealth?
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Things that we can't touch/buy/own, e.g. peace, friendship, time, happiness.
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What is "quality of life"?
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The general well-being of a person or society.
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What do you need to have a good quality of life?
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You need to have a good amount (a balance) of material wealth and non-material wealth to have a good quality of life.
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Why do we need an economical system?
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To balance your needs & wants, and your resources.
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What was the Stone Age?
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A time when people wandered in either tribal or family groups and hunted for food and picked berries, fruits, and nuts.
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What was the main economic focus in the Stone Age?
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The main focus was mainly gathering enough food to survive off of.
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What was the Agricultural Revolution?
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A time when people started to settle and domesticate plants/animals.
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What was the main economical focus of the Agricultural Revolution?
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The main economic focus (for the first time) was managed between food production and key developments that still are prevalent in our society today, e.g. writing systems.
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What were the effects of the Agricultural Revolution?
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The domestication of plants brought in better farming techniques. Once people started to settle in one place, villages/towns started being created, and community growth occurred as well. Also, people had free time to pursue key developments, such as law, medicine, and writing systems. This was mainly because as people settled and were able to stay in one place, they had free time on their hands that they weren't using to gather food.
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What was the Industrial Revolution?
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A time when more scientific farming ideas were used, e.g. motorized/mechanized equipment.
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What was the main economical focus of the Industrial Revolution?
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Cities, because that was where factories were built and manufacturing (a completely new development) was occurring.
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What were the effects of the Industrial Revolution?
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Machines and equipment were introduced to farming, and this eventually lead to the development of secondary industry (manufacturing). Villages and towns grew larger, turning into cities, where economies became focused. Also, urbanization happened, where people moved into cities from their smaller villages, and professions such as banking were introduced.
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What does LEDC stand for?
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LEDC stands for:
L ower E conomic D eveloped C ountry |
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What are the 4 types of economic systems?
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Traditional economies, command economies, market economies, and mixed economies.
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What does poverty look like?
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You may not be able to meet your needs, you have little material & non-material wealth, and you have very few opportunities.
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Why are some countries rich and some poor?
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Either a lack in one or more of the areas of economical structure, or poor management of the areas of economical structure.
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How can we measure quality of life?
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Through the HDI (Human Development Index).
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How can we evaluate quality of life?
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Through material & non-material wealth, through the HDI, and through the GDP.
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What does the HDI measure?
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It measures how good the quality of life is in different countries, taking into account factors such as education and healthcare availability, GDP, economic stability.
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What does GDP stand for?
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Gross Domestic Product.
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What does the GDP measure?
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It measures all the economic output of goods & services per year.
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What can the GDP help us do?
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The GDP, along with the HDI, can help us determine the quality of life in a country.
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What are the 4 different types of economic systems?
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Command, Market, Mixed, and Traditional.
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What is a command economy?
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A command economy is an economic system where the government controls all economics (all economy is public).
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What are some pros & cons of command economies?
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Pros: Everyone is treated fairly (equal resources, what is needed is gotten, everyone is working)
Cons: People can't make decisions (little freedom/choice, people want more than is given), leaders are not flexible (they don't leave), there is danger of corruption, few human rights, and IT NEVER WORKS. |
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What is a market economy?
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A market economy is an economic system where consumers affect business' decisions on what to produce & sell. The government has little say in anything and businesses have a lot of free rein. It is a very competitive economy.
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What are some pros & cons of market economies?
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Pros: People get what they want (freedom & lots of choice), competition (innovation), goods are cheaper, taxes are lower
Cons: Large divisions between rich and poor, money is lost easily, few protecting rules (businesses have too much power). |
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What is a mixed economy?
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A mixed economy is an economic system where the people affect the government who affect the businesses. The business is set rules by the government, the government is influenced by the people, and the people are able to decide what they want.
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What are some pros & cons of mixed economies?
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Pros: Free decisions can be made by everyone, has benefits of both market & command economies, rules protect the workers and the environment, there are human rights, high Q.O.I. (quality of life), and the government provides important services such as education and healthcare.
Cons: Business is expensive (rules raise taxes), businesses may leave, and taxes are high. |
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What is a traditional economy?
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A traditional economy is an economic system where people make decisions to only sustain themselves. They may have tribal leaders/councils. Their main focus is food procurement and storage, but tradition and customs are important as well.
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What are some pros & cons of traditional economies?
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Pros: Most needs are met by individual activities, there is freedom/free time, tradition/culture thrive, people are usually happy, not dependent on technology, live in harmony with nature (survive with the environment).
Cons: It's hard to adapt to changes as economic choices don't vary much, there is unstable leadership, isolation from outside world makes it hard to adapt to changes. |
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What are the 4 factors of poverty?
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Weak Economies, Foreign Debt, Exploding Populations, and Colonization.
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What is a weak economy?
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Exactly what it sounds like. These economies are unstable, usually suffer from one of the 4 factors of poverty, and are sufficiently underdeveloped or weakened.
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What is foreign debt?
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Foreign debt is money that is owed to foreign countries, usually borrowed with the anticipation that the money will be able to be paid back rather quickly.
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What is an exploding population?
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A population that is growing exponentially, so that the country may have problems taking care of it.
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What is colonization?
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Colonization is the act or process of establishing a colony, a territory under control of a country that is distinct from the territory already owned by the ruling country.
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What is primary industry?
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Extraction of resources from the environment that are turned into semi-finished products.
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What is secondary industry?
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Manufacturing; turning resources into finished products.
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What is tertiary industry?
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Services that provide customer services for goods.
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