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GROSS - Economics > Chapter 1: What is Economics? > Flashcards

Chapter 1: What is Economics? Flashcards

1
Q

What is scarcity?

A
  • you can’t have everything
  • unlimited wants vs. limited needs
  • DEMAND is greater than SUPPLY
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2
Q

What determines demand?

A

price

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3
Q

Who is limited in terms of money and how?

A 
INDIVUIDALS
- income
- borrowing
- savings
COOPERATIONS
- profits
- equity financing
GOVERNMENT
-taxes
-borrowing
-printing (monetize)
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4
Q

What are GOODS?

A

tangible (produced) items of value

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5
Q

What are SERVICES?

A
  • facilitating something

- transaction in which no physical goods are transferred from buyer to seller

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6
Q

What are RESOURCES?

A

anything used as an input in the creation of goods and services

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7
Q

What are FACTORS OF PRODUCTION?

A

resources including land, labor, capital, and enterpreneurship

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8
Q

What is SCARCITY?

A

condition resulting from unlimited wants and limited resources

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9
Q

What is ECONOMIZE?

A

effort to get the most out of ones resources

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10
Q

What is EFFICIENCY?

A

to do more with the same or the same with less

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11
Q

What is INCOME?

A

return in the form of wages, profit, rent, and interest earned by the factors of production

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12
Q

What is WEALTH?

A

the value of the things we own

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13
Q

What is NETWORTH?

A

left over money

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14
Q

What is PROFIT?

A

what remains after the cost of doing business have been met

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15
Q

What is another name for profit?

A

residual

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16
Q

What is another name for residual?

A

profit

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17
Q

What is TRADEOFF?

A

giving up on something in order to obtain something more desirable

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18
Q

What is another name for tradeoff?

A

opportunity cost

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19
Q

What is another name for opportunity cost?

A

tradeoff

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20
Q

What is ECONOMICS?

A

the study of people make a living

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21
Q

What two world do economists deal with?

A
  • the world that is

- the world that ought to be

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22
Q

What are the two factors of the world that ought to be?

A
  • politics

- personal values

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23
Q

What do democrats believe should be done about the scarcity of jobs?

A

believe government should provide jobs

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24
Q

What do republicans believe should be done about the scarcity of jobs?

A

believe private sectors/companies should provide jobs

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25
Q

What is another name for natural resources?

A

land

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26
Q

What is another name for human resources?

A

labor

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27
Q

What are the four factors of production and define/explain them all

A

NATURAL RESOURCES
things provided by nature that go into the creation of goods and services
HUMAN RESOURCES
physical and mental effort that people put into the creation of goods and services
CAPITAL
- something created by people to produce other goods and services
- describes the money available to a business firm
ENTREPRENEURSHIP
managerial or organizational skills needed by firms to produce goods and services

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28
Q

What is the price paid for the use of natural resources called?

A

rent

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29
Q

What is the price paid for the use of human resources called?

A

wages

30
Q

Can you make money both physically and mentally?

A

yes

31
Q

What is VENTURE CAPITAL?

A

first money made/collected

32
Q

What is the payment used for someones money called?

A

intrest

33
Q

What are rewards for entrepreneurship?

A

profit

34
Q

What are the four economic questions that dictates the type of system a country has?

A
  • What good are to be produced?
  • How are these goods to be produced?
  • Who receives the goods that are produced?
  • How does society obtain their goods?
35
Q

If the same goods are produced time after time, what economic system does the society have?

A

trditional

36
Q

If goods are produced based on the demand of consumers, what economic system does the society have?

A

market

37
Q

If goods are produced based on the instructions of the governmnet, what economic system does the society have?

A

command

38
Q

What economic system is represented when produce is efficient?

A

market

39
Q

What economic system is represented when the government dictates who gets what?

A

command

40
Q

What economic system is represented when goods are produced they same way they have always been?

A

traditional

41
Q

What economic system is represented when the people with the most money get the goods?

A

market

42
Q

What economic system is represented when the government dictates who gets what?

A

command

43
Q

What economic system is represented when the same people get the same goods?

A

traditional

44
Q

How does a society obtain their goods?

A
  • produce the goods themselves (mercantilism)
  • trade for them (fair trade)
  • gifting
45
Q

What has been the problem with trade since 1960?

A

the US has a defect balance of trade

46
Q

What are suggested solutions to the US’s defect balance of trade?

A
  • tariff

- be efficient

47
Q

Explain how to raise living standards in lesser developed countries…

A

you need to have an agricultural revolution so that farmers can be released from the farms (while the farms are still producing) and sent to work in the city and then the industrial can begin ones the agricultural revolution is finished

48
Q

What are the types of economic systems?

A
  • traditional
  • command
  • market
  • mixed
49
Q

What is an ECONOMIC SYSTEM?

A

approach a country uses to deal with scarcity and achieve its economic goals

50
Q

What is PROFIT MOTIVE?

A

the force that drives owners to produce what buyers want at the lowest price

51
Q

What is MARKET PLACE?

A

any place where goods are bought and sold

52
Q

What is SUBSISTANCE LEVEL?

A

level of income necessary to maintain a minimum standard of living (just enough money to survive)

53
Q

What is INTENSIVE FARMING?

A

more people than land

54
Q

What is EXTENSIVE FARMING?

A

more land than peple

55
Q

What are the traits of a traditional economic system?

A
  • change and growth proceeds slowly
  • people do what their parents have done before them
  • most goods are produced and consumed locally
  • practice intensive farming
56
Q

What are the traits of a command economic system?

A

a system where all major decisions concerning allocation of resources are made by government agencies

57
Q

What is an example of a command economic system?

A

Gosplan - Russia’s five years plans

58
Q

What are the traits of a market economic system?

A
  • private ownership of land (land and capital)
  • competition
  • profits are the key motivation
59
Q

Out of the four factors of production, which two can be owned?

A
  • capital

- natural resources / land

60
Q

What is an alternate name for market economic system?

A

free enterprise

61
Q

What is an alternate name for free enterprise?

A

market economy

62
Q

What is a market economic system?

A

a system where decisions ate made by individual buyers and sellers in a market place that determines the what, how, and for whom

63
Q

What is a mixed economic system?

A

a system that combines elements of private ownership of the means of production with private ownership

64
Q

What is PUBLIC OWNERSHIP?

A

owned by the government (postoffice)

65
Q

What is PRIVATE OWNERSHIP?

A

any private company owned by individual(s) (Apple, Microsoft, etc.)

66
Q

What is the PRODUCTION-POSSIBILITY CURVE?

A

it illustrates the effect of scarcity and opportunity cost on society

67
Q

What is an example of the production possibility curve?

A

spending more on military than domestic and vice versa

68
Q

What is FRONTIER?

A

the most a nation could produce if all its resources were fully utilized

69
Q

What is MICROECONOMICS?

A

the study of individuals/ consumers and the firm

70
Q

What is MACROECONOMICS?

A

the study of the economy as a whole

GROSS - Economics (7 decks)

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