Economic part1 Flashcards

0
Q

An item that we desire but that is not essential to survival

A

Want

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1
Q

Something like air, food, or shelter that is necessary for survival

A

Need

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2
Q

The study of how people seek to satisfy their needs and wants by making choices

A

Economics

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3
Q

Physical objects such as clothes or shoes

A

Goods

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4
Q

Actions or activities one person performs for another

A

Services

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5
Q

Limited quantities of resources to meet unlimited wants

A

Scarcity

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6
Q

A situation in which a good or service is unavailable, or a situation in which the quantity demanded is greater than the quantity supplied, also know as excess demand

A

Shortage

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7
Q

Land, labor, and capital; the three groups of resources that’s are used to make all goods and services

A

Factors of Production

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8
Q

The effort that people devote to a task for which they are paid

A

Labor

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9
Q

Any human made resource that is used to create other goods or services

A

Capital

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10
Q

Ambitious leader who combines land, labor, and capital to create and market new goods and services

A

Entrepreneur

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11
Q

Using fewer resources than an economy is capable of using

A

Underutilization

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12
Q

As we shift factors of production from making one good or service to another, the cost producing the second item increases

A

Law of increasing costs

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13
Q

The income people receive for supplying factors of production: land, labor, or capital

A

Factor payments

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14
Q

Government programs that protect people experiencing unfavorable economic conditions

A

Safety Net

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15
Q

Level of economic prosperity

A

Standard of living

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16
Q

Economic system that relies on habit, custom, or ritual to decide questions of production and consumption of goods and services

A

Traditional Economy

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17
Q

Economic system in which decisions on production and consumption of goods and services are based on voluntary exchange in markets

A

Market economy

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18
Q

Economic system in which the central government makes all decisions on the production and consumption of goods and services

A

Centrally Planned Government

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19
Q

An arrangement that allows buyers and sellers to exchange things

A

Market

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20
Q

The concentration of the productive efforts of individuals and firms on a limited number of activities

A

Specialization

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21
Q

A person or group of people living in the same residence

A

Household

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22
Q

An organization that uses resources to produce a product, which it then sells

A

Firm

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23
Q

The financial gain made in a transaction

A

Profit

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24
Q

One’s own personal gain

A

Self-Intrest

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25
Q

An expectation that encourages people to behave in a certain way

A

Incentive

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26
Q

The power of the consumers to decide what gets produced

A

Consumer sovereignty

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27
Q

A social and political philosophy based on the belief that democratic means should be used to evenly distribute wealth throughout a society

A

Socialism

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28
Q

A political system characterized by a centrally planned economy with all economic and political power resting in the hands of the central government

A

Communism

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29
Q

Large farm leased from that state to groups of peasant farmers

A

Collective

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30
Q

An economic system characterized by private or corporate ownership of capital goods; investments that are determined by private decisions rather than by state control; and determined in a free market

A

Free enterprise

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31
Q

To sell to individuals state-run firms, which are then allowed to compete with one another in the marketplace

A

Privatize

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32
Q

The force that encourages people and organizations to improve their material well being

A

Profit motive

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33
Q

The concept that people may decide what agreements they want to enter into

A

Free contract

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34
Q

The struggle among producers for the dollars of consumers; the rivalry among sellers to attract customers while lowering costs

A

Competition

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35
Q

Laws requiring companies to provide full information about their products

A

Public Disclosure Laws

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36
Q

The total value of all final goods and services produced in a particular economy; the dollar value of all final goods and services produced within a country’s borders in a given year

A

Gross Domestic Product (GDP)

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37
Q

A period of macroeconomic expansion followed by a period of contraction

A

Business Cycle

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38
Q

A commitment to the value of work and purposeful activity; system of values that gives central importance to work

A

Work ethic

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39
Q

The process used to produce a good or service

A

Technology

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40
Q

A shared good or service for which it would be impractical to make consumers pay individually and to exclude nonpayers

A

Public good

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41
Q

The part of the economy that involves the transactions of individuals and businesses

A

Private sector

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42
Q

Someone who would not choose to pay for a certain good or service, but who would get the benefits of it anyway if it were provided as a public good

A

Free rider

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43
Q

A situation in which the market does not distribute resources efficiently

A

Market Failure

44
Q

An income level below which income is insufficient to support families or households

A

Poverty Threshold

45
Q

Government aid to the poor

A

Welfare

46
Q

Goods and services provided for free or at greatly reduced prices

A

In-kind benefits

47
Q

The desire to own som thing and the ability to pay for it

A

Demand

48
Q

When consumers react to an increase in a good’s price by consuming less of that good and more of other goods

A

Substitution effect

49
Q

A graphic representation of a demand schedule

A

Demand curve

50
Q

A measure of how consumers react to a change in price

A

Elasticity of demand

51
Q

Describes demand that is not very sensitive to a change in price

A

Inelastic

52
Q

The total amount of money a firm receives by selling goods or services

A

Total revenue

53
Q

The point at which quantity demanded and quantity supplied are equal

A

Equilibrium

54
Q

Describes any price or quantity not at equilibrium; when quantity supplied is not equal to quantity demanded in a market

A

Disequilibrium

55
Q

When quantity demanded is more than quantity supplied

A

Excess Demand

56
Q

When quantity supplied is more than quantity demanded

A

Excess supply

57
Q

A maximum price that can be legally charged for a good or service

A

Price ceiling

58
Q

A price ceiling placed on rent

A

Rent Control

59
Q

A minimum price that an employer can pay a worker for an hour of labor

A

Minimum Wage

60
Q

Situation in which quantity supplied is greater than quantity demanded; also known as excess supply

A

Surplus

61
Q

The financial and opportunity costs consumers pay when searching for a good or service

A

Search costs

62
Q

A sudden shortage of a good

A

Supply shock

63
Q

A system of allocating scarce goods and services using criteria other than price

A

Rationing

64
Q

A market in which goods are sold illegally

A

Black Market

65
Q

A market structure in which a large number of firms all produce the same product

A

Perfect competition

66
Q

A product that is the same no matter who produces it, such as petroleum , notebook paper, or milk

A

Commodity

67
Q

Any factor that makes it difficult for a new firm to enter a market

A

Barrier to entry

68
Q

A market structure that does not meet the conditions of perfect competition

A

Imperfect competition

69
Q

The expenses a firm must pay before it can begin to produce and sell goods

A

Start-up costs

70
Q

A market dominated by a single seller

A

Monopoly

71
Q

A license that gives the inventor of a new product the exclusive right to sell it for a certain period of time

A

Patent

72
Q

The right to sell a good or service within an exclusive market

A

Franchise

73
Q

A government issued right to operate a business

A

License

74
Q

A division of customers into groups based on how much they will pay for a good

A

Price discrimination

75
Q

The ability of a company to change prices and output lie a monopolist

A

Market Power

76
Q

A series of competitive price cuts that lowers the market price below the cost of production

A

Price war

77
Q

An agreement among firms to divide the market, set prices, or limit production

A

Collusion

78
Q

An agreement among firms to charge one price for the same good

A

Price fixing

79
Q

A formal organization or producers that agree to coordinate prices and production

A

Cartel

80
Q

Selling a product below cost to drive competitors out of the market

A

Predatory Pricing

81
Q

Like a cartel, an illegal grouping of companies that discourages competition

A

Trust

82
Q

a combination of two or more companies into a single firm

A

Merger

83
Q

The removal of some government controls over a market

A

Deregulation

84
Q

An establishment formed to carry on commercial enterprise

A

Business organization

85
Q

A business owned and managed by a single individual

A

Sole proprietorship

86
Q

Authorization to start a business issued by the local government

A

Business license

87
Q

Law in a city or town that designates separate areas for residency and for business

A

Zoning law

88
Q

The legally bound obligation to pay debts

A

Liability

89
Q

Payment other than wages or salaries

A

Fringe benefit

90
Q

A business organization owned by two or more persons who agree on specific divisions of responsibilities and profits

A

Partnership

91
Q

Partnership in which parteners share equally in both responsibility and liability

A

General partnership

92
Q

Partnership in which only one partner is required to be a general partner

A

Limited partner

93
Q

Partnership in which all partners are limited partners

A

Limited liability partnership (LLP)

94
Q

Money and other valuables belonging to an individual or business

A

Assets

95
Q

A legal entity owned by individual stockholders

A

Corporation

96
Q

A certificate of ownership in a corporation

A

Stock

97
Q

A formal contract to repay borrowed money with interest at fixed intervals

A

Bond

98
Q

License to form a corporation issued by state government

A

Certificate of incorporation

99
Q

The portion of corporate profits paid out to stockholders

A

Dividend

100
Q

The combination of toe or more firms competing in the same market with the same good or service

A

Horizontal Merger

101
Q

The combination of toe or more firms involved in different stages of producing the same good or service

A

Vertical merger

102
Q

Business combination merging more than three businesses that make unrelated products

A

Conglomerate

103
Q

Large corporation that produces and sells its goods and services throughout the world

A

Multinational corporation (MNC)

104
Q

Share of earnings given as payment

A

Royalty

105
Q

A business organization owned and operated by a group of individuals for their mutual benefit

A

Cooperative

106
Q

Institution that functions much like a business, but does not operate for the purpose of generating profits

A

Nonprofit Organization

107
Q

Nonprofit organization that promotes the interests of a particular industry

A

Trade association