6.1 Flashcards
people freely choose what to buy and sell
market economy
competition among businesses determine the price of products
free enterprise
businesses industries and resources are privately owned
capitalism
the government decides what to produce where to make it and what price to charge
command economy
an economic and political system in which the government owns or controls almost all the means of production
communism
is the total value of goods and services that a country produces in a year
gross national product
includes only foods and services created within the country
gross domestic product
the process by which manufacturing based on machine power becomes widespread in am area
industrialization
the percentage of people who can read and write
literacy rate
the richest countries
developed countries
a system of roads ports and other facilities needed by a modern economy
infrastructure
less developed countries
developing
the goods a country brings in from different nations
import
the goods a country sells or trades with another nation
export
the ability to produce something at a lower opportunity cost than another country can
comparative advantage
