Economic Systems Flashcards
Production
The process of rendering material items useful and available for human consumption
Economic system
The provision of goods and services to meet biological and social wants
Allocation of resources
The cultural rules people use to assign rights to ownership and use of resources
Technology
The cultural knowledge for making and using tools and extracting and refining raw materials
Division of labor
The rules that govern the assignment of jobs to people
Unit of production
The persons or groups responsible for producing goods and services
The shadow (informal) economy
Consists of production and exchange outside the control of governments and systems of taxation
Exchange
The transfer of goods and services
Market exchange
The transfer of goods and services based on price supply and demand
Reciprocal exchange
The transfer of goods and services between two people or groups based on role obligations
Redistribution
The transfer of goods and services between a central collecting sources and a group of individuals
