Lesson 11 pg. 33 - 37

Question 1

Define capital

Answer 1

Capital (or producer goods) - goods used to produce other goods

Question 2

Define and describe subsistence economy

Answer 2

Subsistence economy - an economic system that provides barely enough to keep a society alive
>have broken down from time to time because of droughts, floods, wars, and other disasters that led to starvation
>majority of people survive by using their simple and scanty capital to produce small supply of consumer goods

Question 3

Define and describe private capitalism

Answer 3

Private capitalism - system in which the majority of a nation’s capital is owned and controlled by private individuals and businesses
>example: United States

Question 4

Define and describe state capitalism

Answer 4

State capitalism - system in which the owner of much of the nation’s capital is a powerful, centralized apparatus called collectivist state
>example: China

Question 5

Define capitalist

Answer 5

capitalist - anyone who owns producer goods or owns a share of some business that produces goods
>examples: those who own stocks or bonds, keep money in banks, or have life insurance policies (because such investments usually mean that the investors’ savings are used by companies that produce goods