Chapter 1 & 2 vocab

Question 1

Need

Answer 1

A basic requirement for survival

Question 1

Gross Domestic Product (GDP)

Answer 1

The monetary value of all final goods, services, and structures produced within a country’s borders in a year/12-month period.

Question 2

Want

Answer 2

Something we’d like to have but isn’t necessary for survival

Question 3

Scarcity

Answer 3

The condition that results from society not having enough resources to produce all the things people would like to have

Question 4

Value

Answer 4

A worth that can be expressed in dollars and cents

Question 5

Nondurable good

Answer 5

An item that lasts for less than three years when used on a regular basis
(ex: food, writing paper, and most clothing items)

Question 6

Capital good

Answer 6

A tool/good such as machinery or equipment that’s used by businesses to produce other products

Question 7

Economics

Answer 7

The study of how people try to satisfy seemingly unlimited and competing needs and wants through the careful use to relatively scarce resources

Question 8

Land

Answer 8

Earth’s surface that most of human activity has occurred

Question 9

Capital

Answer 9

Seen at the most important city in a nation, usually the position of government administration

Question 10

Entrepreneurs

Answer 10

Individuals who run a business or multiple businesses that assume a great deal of responsibility and financial risk

Question 11

Produce market

Answer 11

Where goods and services are sold to public sectors and businesses, excluding raw materials

Question 12

Production Possibilities Curve (PPC)

Answer 12

Curve that illustrates the variations in the amounts that can be produced of two products if both depend upon

Question 13

Consumerism

Answer 13

A social and economic order that encourages the acquisition of goods and services in ever-increasing quantities

Question 14

Specialization

Answer 14

Becoming an expert in a certain field or area

Question 15

Economic Interdependence

Answer 15

Transactions between two countries or multiple countries to acquire products they can’t produce efficiently

Question 16

Standard of living

Answer 16

Amount of material, income and services available to a society or person

Question 17

Black Market

Answer 17

Illegal market that occurs outside of government control

Question 18

Capitalism

Answer 18

An economic/political system in which individuals own sectors for the means of production and self profit

Question 19

Command economy

Answer 19

An economic system where prices and income are determined by the government

Question 20

Economic system

Answer 20

A system where governments supply available resources/goods across a nation

Question 21

Five-year plan

Answer 21

A nation’s plan for economic growth over the course of five years

Question 22

Great Leap Forward

Answer 22

Economic campaign led by Chinese communists from 1958-1962 to reconstruct the economy (rapid industrialization)

Question 23

Market Economy

Answer 23

A system of economic decisions guided by the price signals of supply and demand

Question 24

Nationalization

Answer 24

Process where a nation or state takes control of a specific industry/business

Question 25

Privatization

Answer 25

The transfer of ownership of a business/property from the government to a private sector

Question 26

Traditional economy

Answer 26

The use of scarce resources and nearly all other economic activity stems from ritual, habit, or custom

Question 27

Communism

Answer 27

Economic/political system in which factors of production are collectively owned and directed by the state
–A theoretically classless society in which everyone works for the common good

Question 28

Mixed economy

Answer 28

A market economy with elements of private and public sectors

Question 29

Socialism

Answer 29

An economic/political system in which the government plays owns some, but not all, of the factors of production

Question 30

Great Depression

Answer 30

Worst period of economic decline in US history beginning in 1929 to 1939

Question 31

Capital-intensive

Answer 31

Amount of capital present in factors of production, especially labor

Question 32

European Union

Answer 32

Economic union stationed in Europe between 27 European countries
–Largest single unified marker in the world in terms of population and output

Question 33

Collectivization

Answer 33

The organization of all a nation’s productions and industry into government ownership and control