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28 Cards in this Set

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Economic Resources
All natural, human and manufactured resources.
Land
includes ALL natural resources; it is used in the production of goods and services; arable land, forests, minerals, oil, water, etc.
Capital
Investment goods; all manufacturing aids used in producing consumer goods and services. Tools, machinery, equipment, factories, storage, transportation, and distribution facilities.
Investment
The process of purchasing capital goods.
Labor
A broad term fro all the physical and mental talents of individuals available and usable in producing goods and services.
Entreprenurial Ability
A special resource; a person who take the initiative, makes strategic business decisions, innovates, and risk bearer.
The Factors of Economic Production (memory key)
LLCE (Land, Labor, Capital, Etreprenurial Ability)
full employment
The use of all available resources
full production
all employed resources must be used so that they provide the maximum possible satisfaction of economic wants.
allocative efficiency
The least-cost production of that particular mix of goods and services wanted by society.
productive efficiency
The production of any particular mix of goods and services in the least costly way.
fixed resources
The available supplies of the factors of production are fixed in both quantity and quality.
fixed technology
The state of technology, does not changed during analysis.
two goods
The concept that the economy is only producing tow goods. Consumer goods and capital goods.
Production Possibilites Table
It lists the different combinations of two products that can be produced with a specific set of resources.
Assumptions of the Production Possibilities Table
Full Employmnet and productive efficiency, Fixed resources, Fixed Technology, Two Goods
Production Possibilities Curve
A production "frontier" showing the limits of attainable outputs.
Opportunity Costs
The amount of other products that must be forgone to obtain 1 unit of a specific good.
Law of Increasing Opportunity Costs
The more of a product that is produced, the greater is its opportunity cost(marginal being implied)
economic growth
The ability to produce a larger total output.
economic system
A particular set of institutional arrangements and a coordinating mechanism.
consumer goods
products that satisfy our wants directly
capital goods
products that satisfy our wants indirectly by producing consumer goods efficiently. IE(robots, factories, tools, etc)
market system (capitalism)
The private ownership of resources and the uses of markets and prices to coordinate and direct economic activity.
command system (socialism/communism)
The govt. owns most property resources and economic decisions occur through a central economic plan.
resource market
The place where resources or the services of resources suppliers are bought and sold.
product market
The place where goods and services produced by businesses are bought and sold.
circular flow model
suggests a complex, interested web of decision making and economic activity involving businesses and households.