Civics Quiz 1.1 Flashcards
What is a circular flow model?
Visualizes how all interactions occur in a market economy
What is a competition?
Involves all the action sellers do to get buyers to purchase their products
What is customer sovereignty?
Consumers have ultimate control over what is produced
What is economic systems?
The way society uses its scarce resources to satisfy its peoples unlimited wants
What is factor market?
Households, market for the factors of production, business purchase the factors
What is product market?
Business, market for the goods and services, set of activities in which people buy goods and services
What is specialization?
People who concentrate their efforts in the activities they do best
What is voluntary exchange?
A trade in which both traders believe what they are getting is worth more than what they give up
What is a market economy? What is good about it? What is bad about it?
Decisions on production and consumption of goods and services are based on voluntary exchange in markets, pos.- individual freedom, most efficient use of resources, neg.- some act destructively toward themselves and others, uneven distribution of goods
What is a command economy? What is good about it? What is bad about it?
Th central government makes all decisions on the production and consumption of goods and services, pos.- goods are distributed even, neg.- lack of motivation/freedom
What is a traditional economy? What is good about it? What is bad about it?
Relies of habit, custom to decide questions about the consumption of goods and services, pos.- Decisions based on what’s worked in the past, negative.- No production better, less wealth, and just trying to survive
