chapter 6 Flashcards
People freely choose what to buy and sell
market economy
This system lets competition among businesses determine the price of products
free enterprise
Businesses, industries, and resources are privately owned
capitalism
The government decides what to produce, where to make it, and what price to charge
command economy
Is an economic and political system in which the government owns or controls almost all means of production
communism
Is the total value of goods and services that a country produces in a year
gross national product
Includes only goods and services created within the country (located in foreign lands)
gross domestic product
Is the process by which manufacturing, service, and information industries
industrialization
The percentage of people who can read and write, also reflects standard of living
literacy rate
High levels of industrialization, and their people enjoy high standards of living
developed countries
Is a system of roads, ports, and other facilities needed by modern economy
infrastructure
Less developed countries
developing countries
The goods a country brings in from different nations
import
The goods a country sells or trades with another nation
export
The ability to produce something at a lower opportunity cost than another country can.
comparative advantage
Use of tactics that make imported goods more expensive than domestic goods.
protectionism
Tax on imports. The goal is to make imported goods higher than those produced at home
tariff
A limit placed on the amount of a particular good that enters a country (US has a long history of putting a quota on imported sugar)
quota
a payment or other benefit given by the government to help a domestic producer. (US and Europe pays subsidies to farmers)
subsidy
Hunters and gathers learned how to grow plants and tame animals for their own use, this innovation is called
domestication
The growth in the proportion of people living in towns and cities is called
urbanization
Some cities grow into huge urban areas called
world cities
Transportation hubs where roads, railroads, and buses come together.
central business district
These clusters of large buildings away from the CBD are called
edge cities
