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31 Cards in this Set

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market price (equilibrium price)
profit-maximizing price at which the quantity of goods demanded and the quantity of goods supplied is equal
surplus
situation in which quanity supplied exceed quantity demanded
shortage
situation in which the quantity demanded exceeds the quantity supplied
private enterprise
economic system that allows individuals to pursue their own interests without undue governmental restriction
competition
vying among businesses for the same resources
perfect competition
market or industry characterized by numerous small firms producing an identical product
monopolistic competition
market or industry characterized by numerous buyers and relatively numerous sellers trying to differentiate their products from those of competitors
oligopoly
market or industry in which there is only one producer that can therefore set the prices of its products
monopoly
market or industry in which there is only one producer that can therefore set the prices of its products
natural monopoly
industry in which one company can most efficiently supply all needed goods or services
economic indicator
a statistic that helps assess the performance of an economy
business cycle
short-term pattern of economic expansions and contractions
aggregate output
the total quantity and quality of goods and services produced by an economic system during that a given period of time
standard of living
the total quantity and quality of goods and services people can purchase with the currency used in their economic system
gross domestic product
total value of all goods and services produced within a given period by a national economy through domestic factors and production
gross national product
total value of goods and services produced by a national economy within a given period regardless of where the factors of production are located
real GDP
gross domestic product adjusted to account for changes in currency values and price changes
nominal GDP
gross domestic product measured in current dollars or with all components valued at current prices
purchasing power parity
principle that exchange rates are set so that similar products in different countries cost about the same
productivity
a measure of economic growth that compares how much a system produces with the resources needed to produce it
balance of trade
the economic value of all the products that a country exports minus the economic value of all the products it imports
national debt
the amount of money a government owes its creditors
stability
condition in which the amount of money available in an economic system and the quantity of goods and services produced in it are growing at about the same rate
inflation
occurs when widespread price increases occur thoughout an economic system
consumer price index
a measure of the prices of typical products purchased by consumers living in urban areas
unemployment
level of joblessness among people actively seeking with within an economic system
recession
a period during which aggregate output, as measured by GDP, declines
depression
a prolonged and deep recession
fiscal policies
policies used by a government regarding how it collects and spends revenue
monetary policies
policies used by a government to control the size of its money supply
stabilization policy
government economic policy intended to smooth out influctuations in output and unemployment and to stabilize prices