Chapter 2 Flashcards
Is the study of how society chooses to employ resources to produce goods and services and distribute them for consumption among competing groups and individuals.
Economics
Name and describe the two types of economics
Macro economics looks at the operation of a nations economy as a whole
Micro economics looks at the behavior of people and organizations in markets for particular products and services.
Define resource development
The study of how ti increase resources and make better use of them.
This is the process that turns self directed gain into social and economic benefit for all.
The invisible hand
What was the major flaw in Adam Smiths thinking?
That those who generated large amounts of wealth would naturally reach out to those less fortunate.
He underestimated greed.
Define capitalism
the economic system where much or most of the factors of production are privately owned.
What is State Capitalism
A combination of capitalism with state controls
what are the four rights under fire market capitalism
- Right to own property
- Right to own a business and keep profits
- Right to freedom of competition
- Tight to freedom of choice.
What is a free market
One where decisions are based on market demands
define Supply
The quantity of products businesses are willing to sell at different prices at a specific time.
Define Demand
the quantity people are willing to buy at different prices at a specific time
What is the equilibrium point
Is the the supply curve and demand curve meet, this becomes the market price
What is Perfect Competition
Enough sellers that no-one controls price and products are similar.
What is Monopolistic Competition
Large number of sellers with similar products that are perceived as different through branding and marketing.
What is Oligopoly competition
When a few sellers dominate the market with similar products at similar prices.