chapter 14

Question 1

any resource that is valued for its potential economic contributions

Answer 1

captial

Question 2

the quantity of something at a particular point in time

Answer 2

stock

Question 3

any activity intended to increase the quantity or quality of a resource over time

Answer 3

investment

Question 4

an increase or decrease over time in a capital stock

Answer 4

flow

Question 5

a diagram that shows how a stock changes over time, as flows add to it or subtract from it

Answer 5

stock-flow diagram

Question 6

physical assets provided by nature

Answer 6

natural capital

Question 7

all physical assets that have been made by humans using natural capital

Answer 7

manufactured (or produced) capital

Question 8

all physical assets that have been made by humans using natural capital

Answer 8

human capital

Question 9

the stock of relationships, including trust and shared values, that facilitates economic activities

Answer 9

social capital

Question 10

funds of purchasing power available to purchase goods and services or facilitate economic activity

Answer 10

financial capital

Question 11

resources that are tangible (i.e., can be touched or seen)

Answer 11

physical capital

Question 12

resources that cannot be seen or touched

Answer 12

intangible capital

Question 13

a resource that regenerates through short-term natural processes

Answer 13

renewable resource

Question 14

a resource that can only diminish over human time scales

Answer 14

nonrenewable resources

Question 15

the possibility of using one resource instead of another

Answer 15

substitutability

Question 16

manufactured goods that yield a flow of productive services over an extended period

Answer 16

fixed manufactured captial

Question 17

decrease in the usefulness of a stock of capital due to wear and tear or obsolescence

Answer 17

depreciation

Question 18

stocks of raw materials or manufactured goods being stored until they can be used or sold

Answer 18

inventories

Question 19

the ways in which human productive activities are structured and coordinated

Answer 19

social organization

Question 20

an economic actor’s use of its own funds to make productive investments

Answer 20

equity finance

Question 21

borrowing others’ funds to make productive investments

Answer 21

debt finance

Question 22

money borrowed for temporary use, on the condition that it be repaid, usually, in commercial transactions, with interest

Answer 22

loan

Question 23

the original amount of money borrowed

Answer 23

principal

Question 24

the charge for borrowing money

Answer 24

interest