Chapter 3 Flashcards
The body of knowledge that relates to producing and using goods and services
economics
the desire for scarce materials
economic wants
the desire for non-scarce materials
non-economic wants
the ability to satisfy a want or need
utility
anyone who creates a utility
producer
used in creating goods and services
factors of production
anything provided by nature that affects the productive capability of a country
natural resources
human effort, either physical or mental, that goes into producing goods or services
labor
the accumulated knowledge and skills of human beings
human capital
goods used to produce consumer goods, like land, buildings, tools, machines
capital goods
the production of capital goods
capital formation
goods and services that directly satisfy consumer wants and needs
consumer goods
an organized way for a country to decide how to use its productive resources
economic system
an economic system in which individual buying decisions determine what, how and for whom goods and services will be produced
market economy
an economic system in which a central planning authority owns most of the factors of production
command economy
an economic system that uses aspects of both a market and command economy
mixed economy
the transfer of authority to provide a good or service from government to individual
privatization
an economic political system in which private citizens are free to go into business for themselves, produce whatever they like and distribute it
capitalism
an economic political system in which the government controls the use of the country’s factors of production
socialism
extreme socialism
communism
items of value that individuals have the right to own, use and sell
private property
incentive for producing goods and services
profit
the number of items that will be bought at a given time at a given price
demand
the number of items that will be offered for sale at a particular time and at a certain price
supply
rivalry among sellers for a consumers dollar
competition
