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Econ > Economic systems > Flashcards

Economic systems Flashcards

1
Q

The study of individuals, families, and businesses in the economy

A

Microeconomics

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2
Q

The study of the economy as a whole; concerned with large-scale economic activity

A

Macroeconomics

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3
Q

Studies economic behavior as it is

A

Positive economics

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4
Q

Judgements of what economic behavior ought to be

A

Normative economics

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5
Q

What are the three basic economic questions?

A

What are we producing?
How are we going to produce it?
Who are we producing it for?

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6
Q

The way a society uses its scarce resources to satisfy its people’s unlimited wants

A

Economic system

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7
Q

Basic economic system in which families, clans, or tribes make economic decisions based on customs and beliefs that have been handed down from generation to generation

A

Traditional Economy

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8
Q

Economic system in which the govt decides what goods and services will be produced, how they will be produced, and how they will be distributed

A

Command economy

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9
Q

Economic system based on individual choice, not govt directives

A

Market Economy

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10
Q

System by which the govt of the homeland controlled trade with its colonies

A

Mercantilism

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11
Q

Wrote Wealth of Nations, and is considered the father of Economics

A

Adam Smith

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12
Q

A system in which the society’s leaders make all economic decisions

A

Centrally planned economy

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13
Q

Economic system in which the govt owns some or all of the factors of production

A

Socialism

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14
Q

Economic system in which the govt owns all the factors of production and there is little or no political freedom

A

Communism

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15
Q

System which requires absolute obedience to those in power

A

Authoritarian System

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16
Q

Economic system in which the govt owns the basic industries, but other industries are privately owned; Established through the democratic political process rather than through the violent overthrow of the govt

A

Democratic Socialism

17
Q

Who published The Communist Manifesto, which laid out the ideas of worker overthrow?

A

Karl Marx

18
Q

The publisher of The Communist Manifesto stated that the Industrial Revolution had created a system of _______________

A

Wage Slavery

19
Q

The rights of individuals and groups to own businesses and resources; necessary to make markets work properly

A

Private property rights

20
Q

Any place where people buy and sell goods and services

A

Market

21
Q

___________ is vital to any sale or exchange

A

Clear ownership

22
Q

The principle that the govt should not interfere in the economy

A

Laissez faire

23
Q

An economic system that is based on private ownership of the factors of production

A

Capitalism

24
Q

A market economy in its pure form

A

Laissez faire capitalism

25
Q

A trade in which both traders believe that what they are getting is worth more than what they give up

A

Voluntary exchange

26
Q

____________ is considered a financial gain from a business transaction

A

Profit

27
Q

The effort of two or more people, acting independently, to get the business of others by offering the best deal

A

Competition

28
Q

________ guides voluntary exchanges

A

Self-interest

29
Q

The idea that because consumers are free to purchase what they want and refuse products they do not

A

Consumer sovereignty

30
Q

A situation in which people concentrate their efforts in the areas in which they have an advantage

A

Specialization

31
Q

A tool that economists use to understand how market economies operate

A

Circular flow model

32
Q

The market for goods and services is called the _________

A

Product market

33
Q

The market for the factors of production

A

Factor market

34
Q

Insures that resources will be allocated efficiently, since inefficiencies would result in lower profits

A

Profit motive

35
Q

An economy that has elements of traditional, command, and market systems

A

Mixed economy

36
Q

Which economic system dominates the US?

A

Market economy

37
Q

To change from private ownership to govt or public ownership

A

Nationalize

38
Q

To change from govt or public ownership to private ownership

A

Privatize

39
Q

All the economic interactions that cross international boundaries

A

Global economy

Econ (6 decks)

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