coolander Flashcards
Disadvantages of shifting ppf
1) Loss of specific jobs
2) Loss of skills - dependence on others
3) Monotony of labor
4) Potential for inequality of trade
5) Importation of disease - non-native species
two things ppf demonstrates?
- there is a limit to what you can achieve given the existing institutions, resources, and technology
- every choice you make has an opportunity cost. you can get more of something only by giving up something else
Markets work through a system of…
rewards and payments
What is distribution?
getting goods where you want them when you want them
global corporations
corporations with substantial operations on both production and sales in multiple countries
macroeconomics externality
externalities that affect the levels of unemployment, inflation, or growth in the economy as a whole.
six specific roles gov plays in economy?
- provides laws and institutions
- promotes effective competition and no monopolies
- corrects externalities with taxes, subsidies, and regulation
- ensures econ stability and growth by maintaing activity and price level
- provides public goods like education and public defense
- adjusts for undesirable market results like making drugs illegal and subsidizing charity
what are the gov’s two general roles?
referee( setting the rules that determine relations between business and households)
actor( collecting money in taxes and spending that money on projects like self defense and education)
flexible-purpose corporations or benefit corporations
take social mission in addition to profit into consideration when making decisions.
Sole proprietorship
businesses that have only one owner
Partnerships
businesses with two or more owners
corporations
businesses that are treated as a person, legally owned by stockholders. stockholders are not liable for the actions of the corporate “person”
Institutions
Formal and informal rules that control human economics behavior. like laws
