CHAPTER 1: SUPPLY & DEMAND VOCAB Flashcards
Aggregate Output
the total quantity of goods and services produced by an economic system during a given period
Balance of Trade
the economic value of all products a country exports minus the economic value of all products it imports
Business
an organization that provides goods or services to earn profits
Business Cycle
short-term pattern of economic expansions and contractions
Capital
funds needed to create and operate a business enterprise
Capitalism
a system that sanctions the private ownership of the factors of production and encourages entrepreneurship by offering profits as an incentive
Communism
a political system in which the government owns and operates all the factors of production
Competition
vying among businesses for the same resources or customers
Consumer Price Index (CPI)
a measure of the prices of typical products purchased by consumers living in urban areas
Demand
the willingness and ability of buyers to purchase a good or service
Demand and Supply Schedule
assessment of the relationships among different levels of demand and supply at different price levels
Demand Curve
graph showing how many units of a product will be demanded (bought) at different prices
Depression
a prolonged and deep recession
Domestic Business Environment
the environment in which a firm conducts its operations and derives its revenues
Economic Environment
relevant conditions that exist in the economic system in which a company operates
Economic Indicators
statistics that help assess the performance of an economy
Economic System
a nation’s system for allocating its resources among its citizens
Entrepreneur
businessperson or individual who accepts the risks and opportunities involved in creating and operating a new business venture
External Environment
everything outside an organization’s boundaries that might affect it
Factors of Production
resources used in the production of goods and services - labor, capital, entrepreneurs, physical resources, and information resources
Fiscal Policies
policies used by an environment regarding how it collects and spends revenue
Global Business Environment
the international forces that affect a business
Gross Domestic Product (GDP)
the total value of all goods and services produced within a given period by a national economy through domestic factors of production
GDP per Capita
gross domestic product divided by total population
Gross National Product (GNP)
total value of all goods and services produced by a national economy within a given period regardless of where the factors of production are located