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Economics > 1139 Definitions + accidental extras > Flashcards

1139 Definitions + accidental extras Flashcards

1
Q

method by which economic problems are solved in a society

A

economic system

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2
Q

system by which economic decisions are made in a government

A

command system

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3
Q

system by which decisions are made by historical tradition

A

traditional system

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4
Q

system in which decisions are made in response to supply and demand

A

market system

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5
Q

systematic study of the production, distribution, and consumption of goods and services

A

economics

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6
Q

Biblical term for contract

A

covenant

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7
Q

quantity of goods or services available for sale

A

supply

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8
Q

desire of potential buyers for goods and services

A

demand

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9
Q

a single business that is the only source for a product or service

A

monopoly

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10
Q

union of several corporations who unite to eliminate competition and regulate prices

A

trust

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11
Q

type of socialism that involves government ownership of businesses and industries

A

ownership socialism

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12
Q

type of socialism that involves government control of wages and prices

A

control socialism

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13
Q

excess of total revenue over total cost

A

profit

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14
Q

excess of total cost over total revenue

A

loss

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15
Q

means by which value is determined

A

economic calculation

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16
Q

developed from the writings of Karl Marx
attempts to end capitalism through revolution
has failed in most nations where it has been tried
advocates expropriation of private property without compensation

A

Communism

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17
Q

advocates a gradual transfer of the means of production to public ownership
developed from the writings of Karl Marx
may allow political freedom and free elections
continues to exist in many nations

A

Socialism

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18
Q

author of ‘The Wealth of Nations’

A

Adam Smith

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19
Q

author of Das Kapital and Communist Manifesto

A

Karl Marx

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20
Q

a small capitalist

A

petty bourgeois

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21
Q

practice that leads to economic collapse

A

overexpanded credit

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22
Q

a socialist

A

Karl Marx

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23
Q

a capitalist

A

Adam Smith

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24
Q

economic system with a highly controlled market and many government regulations

A

mercantilism

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25
Q

strongest motivation in trade

A

self-interest

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26
Q

real price for a good or service

A

labor

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27
Q

nominal price of a good or service

A

money

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28
Q

the cost of production

A

natural price

29
Q

material used in production

A

stock

30
Q

tools or equipment used in production

A

capital

31
Q

price at which the product is sold

A

market price

32
Q

desire for a product

A

demand

33
Q

demand without ability to pay

A

absolute demand

34
Q

demand of those willing and able to pay

A

effectual demand

35
Q

lack of all types of restraints on trade

A

laissez-faire

36
Q

prevents limiting of production to raise prices

A

competition

37
Q

According to Adam Smith, government’s only functions are

A

justice, public works, defense

38
Q

Karl Marx’s economic model

A

Capitalism will eventually collapse
Capitalism has an inherent tendency to overproduce
Capitalism has an inherent tendency to expand credit continuously.
Capitalism inevitably produces business cycles.
Eventually a major depression destroys capitalism.
At that point, the proletariat takes over and a new communist society is established.
The new, utopian society had no need for government or money
Because government did not vanish in communist nations, leaders modified Marxism and claimed that a transition stage was necessary

39
Q

study of individual units of an economy

A

microeconomics

40
Q

study of the economy as a whole

A

macroeconomics

41
Q

a stable economy

A

equilibrium

42
Q

value of income in terms of purchasing power

A

real wage

43
Q

value of income in monetary terms

A

money wage

44
Q

market value of all final goods and services produced within a nation during one year

A

gross domestic product

45
Q

wearing down of buildings, tools, and machines

A

capital depreciation

46
Q

continuous increase in average prices of goods and services

A

inflation

47
Q

market value of all final goods and services produced by the citizens and businesses of a nation during one yeat

A

gross national product

48
Q

income to those who loan money

A

interest

49
Q

measure of the change in average prices of common goods and services

A

consumer price index

50
Q

payment for the risk factor inherent in any loan

A

pure profit

51
Q

payment without regard to variations in interest rates

A

pure interest

52
Q

payment for an expected decrease in the purchasing power of money

A

inflation premium

53
Q

payment to induce a lender to part with present purchasing power

A

originary interest

54
Q

Government _____________ that affect a nation’s economy are an indirect method of attaining _______________ that politicians consider desirable

A

fiscal policies

macroeconomic goals

55
Q

These fiscal policies also affect ____________ of businesses and individuals

A

microeconomic decisions

56
Q

Macroeconomics focuses of the _________, the _______, and the ___________ and/or ___________

A

employment level
production level
economic growth
stability of a national economy

57
Q

The Great Depression was a ___________ caused partly by ____________ and partly by the ____________.

A

worldwide event
high import tariffs
overpricing of labor

58
Q

The solution of governments to the Depression was to

A

inflate the currency

59
Q

When a currency is inflated, the ________________

A

real wage drops and the money wage remains the same

60
Q

The CPI is a measurement of _________, and the cost of the market basket is the gauge of the ___________

A

inflation

cost of living

61
Q

Jean Baptiste Say’s law states that ______________________

A

economy tends toward equilibrium

62
Q

A ____________ exists among consumers, businesses, governments, and financial institutions

A

circular flow

63
Q

J.M. Keynes theory included the idea that _______

A

a depression occurs because of overproduction
a depression is an example of capitalism’s failure to operate
government spending and inflation stimulate consumption and investment
government should institute deficit spending on public works
credit spending is a virtue

64
Q

Gross domestic product is

A

the sum of an economy’s outputs
expressed in units of value
a report of total production for a period of one year
a measurement of final output

65
Q

The gross domestic product is limited because

A

it deals with money values as opposed to real values
it does not measure unpaid production
it may reflect an increase in government spending
it does not measure quality

66
Q

The rate of inflation may be measured as

A

an annual rate of increase in the average price level

a decrease in the value of money

67
Q

Methods suggested for reducing inflation

A

increasing the output of goods and services
eliminating excessive money growth
simply accepting, constant, gradual inflation

68
Q

Interest rates vary because

A 
loans are for varying lengths of time
lenders may search for the best rate
the supply of funds and the demand for loans vary
there are differing amounts of risks
the cost of administering loans varies

Economics (12 decks)

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