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39 Cards in this Set

  • Front
  • Back
when one country can produce a good more cheaply than another.
absolute advantage
according to John Maynard Keynes, the sum of the demand of three sectors of the economy: households, businesses, and government.
aggregate demand
the effect, according to Marx, of capitalist systems which do not allow the working class to develop their productive potential or satisfy their real human needs.
according to Marx, the class that owns the means of production.
a system where a single authority makes the decisions about what is produced, and by whom, and to whom it is distributed.
command economy
the belief that government should be authoritative, defining the needs of the community and seeing that those needs are met.
a grant that indicates that a particular expression of an idea is the private property of an individual or company.
the system a society uses to provide the goods and services it needs to survive and flourish.
economic system
the materials and social controls that society uses to produce its economic goods.
economic substructure
the materials (land, labor, natural resources, machinery, energy, technology) used in production.
forces of production
a system in which individual firms, privately owned, make their own decisions about what they will produce and how they will produce it.
free market system
the process by which the economic and social systems of nations are connected together so that goods, services, capital, and knowledge move freely between nations.
the Marxist view that history is determined by changes in the economic methods by which humanity produces the materials on which it must live.
historical materialism
a system of normative beliefs shared by a group, expressing answers to questions about human nature, the purpose of society, and the values of the group.
the combined effects of increased concentration, cyclic crises, rising unemployment, and declining relative compensation.
the belief that government has a limited role, existing primarily to protect the property of the individual and keep the marketplace open.
the property that consists of an abstract, nonphysical object; such property, unlike physical property, is nonexclusive.
intellectual property
according to Adam Smith, market competition drives self-interested individuals to act in ways that serve society.
invisible hand
according to John Maynard Keynes, free markets alone are not necessarily the most efficient means for coordinating the use of societies resources.
Keynsian economics
according to Locke, the moral principle that since all men are free and equal, no one ought to harm another in his life, health, liberty, or possessions.
law of nature
the right to life, liberty, and property.
Lockean rights
an economic system based primarily on private individuals making decisions about what they will produce and who will get it.
the buildings, machinery, land, and raw materials used in the production of goods and services.
means of production
an economy with both free market and central planning attributes.
mixed economy
the rights that nature teaches each man that he has according to the law of nature.
natural rights
the assumption that whatever happens naturally is always for the best.
naturalistic fallacy
new inventions invented by a person that are designed as private property.
economists who have sought to challenge and modify Keynesian economics.
post-Keynesian school
a system that maintains a system of property laws to assign private individuals the right to make decisions about what they own.
private property
according to Marx, the alienated working class.
the social controls used in producing goods (i.e., the social controls by which society organizes and controls its workers).
relations of production
all available resources are used and demand always expands to absorb the supply of commodities made from them.
Says law
belief that economic competition produces human progress.
social Darwinism
a society’s government and its popular ideologies.
social superstructure
according to Locke, the state where each man is the political equal of all others, perfectly free of any constraints except the law of nature.
state of nature
the difference between the value of labor and the wage paid for it.
surplus value
Charles Darwin’s term for the process of natural selection.
survival of the fittest
societies that rely on traditional communal roles and customs to carry out basic economic tasks.
tradition based societies