Chapter 2 Review Flashcards
Which political philosophy seeks economic growth and stability rather than full employment?
conservative
What term refers to the enjoyment of many goods, including servies?
prosperity
Name the factors that must remain stable for a country to achieve economic stability
inflation rate, unemployment rate, growth rate of goods and services
What do some economists list as a fifth factor of production?
information
What are taxes that governments apply only to imported goods?
tariffs
What economy allows people to make their own economic choices?
free enterprise
What is the separation of work to be performed into individualized tasks?
division of labor
What did Adam Smith say brought producers and consumers together when they pursue their personal interests?
an invisible hand
What human activity results in the creation of goods and services?
labor
What term refers to the difference in value of the goods that a country sells abroad compared to those it purchases from other countries?
trade balance
What book did Adam Smith publish in 1776?
The Wealth of Nations
What economy has a system in which a centralized authority controls the production, distribution, and consumption of goods?
command
