chapter 6 Flashcards
what is scarcity? how does it occur?
having short/limited supply
occurs bc ppl had unlimited wants, but there are limited resources
what are the factors of production?
land - resources
labour - workers
capital - money
what is an economic system? what are the three systems?
a way to solve the basic problem of scarcity.
or [method used to produce goods/services]
planned, mixed, market
what are the questions to determine economic system of a country?
1) who decides what is produced
2) who decides how it is produced
3) who decides who consumes it
command economy
most government control - make decisions about the production/consumption of goods
mixed economy
system that combines the traditional/command and free market
market economy
economic decisions are made by individuals + based on exchange/trade
what is a market? why do they exist?
allows buyers + sellers to exchange goods/services
exist bc no one produces all the goods we need to satisfy us
what are some advantages of a market economy?
- economic efficiency
- more economic freedom
- encourgaes growth through competition
- offers wide variety of services
how does a mixed economy have both market and command values?
gov’t controls peoples needs
marketplace takes care of peoples wants
what is an advantage and disadvantage of mixed economy
pro: a balance of wants and needs
con: citizens have to pay taxes
what is the difference between public and private
public: ideals of equality + economic strength is promoted
private: feeling of control, provides incentive
what are the different values of mixed and market economy
mixed: cooperation [ppl must consider others and set aside differences for society]
market: individualism [whats best for each person adds up to whats good for society]
what is competition?
is abt wanting consumers to buy their products
producers attract consumers with price, advertising, and product quality
the act/process of trying to get or win sales
what is a monopoly
when a produceer controlls all the supply of a good/service
laws are in place to prevent monopolies since they are unfair for the consumer
what are entrepreneurs
ppl willing to compete + take risks in market economy
they think of innovations and get profit from their idea
how they market is the key to success
what is supply and demand? how is scarcity affected by it?
scarcity is solved in market encomies with supply and demand
connect via a cause/effect relationship
more demand - low supply - high price
high price - low demand - more supply
more supply - low price - more demand
what is a labour union?
organized by workers to represent needs to employer
allow workers to act as a group [collective bargaining]
how are labour unions effective?
what are forms of pressure that labour unions use?
collective bargaining is more efficient than one person
can pressure employers abt wages, working hours, workplace safety
strikes - workers refuse to do their job
what is a crown corperation?
what is their purpose
crown corperations can only exist in one type of economy. what economy?
a company owned by canadas govt
made to: provide services, promote economic development, support canadian culture
only exist in a mixed economy
what is budgeting?
there are two ways the govt can approach budgeting. what are they?
when the govt has to decide how to spend tax money.
govt can either be involved in economic decision making OR allow private sctors to make economic decisions
