Personal & Family Finance

Question 0

Economic System-

Answer 0

A structure within a society that organizes the production, distribution, and consumption of goods & services.

Question 1

Economy -

Answer 1

“The range of economic activity in a country, region, or community.”

Question 2

Economics -

Answer 2

The study of the ways in which money is created & used in society.

Question 3

Gift Economies -

Answer 3

Consists of situations where goods and services are exchanges without an expected or immediate return.

Question 4

Barter Systems -

Answer 4

Feature a direct exchange of goods without the use of money or another medium of exchange.

Question 5

Market Economies -

Answer 5

Prices of services & goods are determined through a free system.

Drawback = they tend to create extreme divisions between wealthy & poor.

Question 6

Laissez-Faire (Free Enterprise) -

Answer 6

A pure market economy where there is no governmental presence in transactions. The economy does not include things like taxes, tariffs, or any type of regulation.

Question 7

Supply & Demand -

Answer 7

Market economies operate on this principle. Thought to “regulate” itself without any outside help from the government or other entities.

Question 8

Planned economies -

Answer 8

Prices of goods & services are determined by the government or state.

Question 9

Mixed economies -

Answer 9

Have a mixture of planned & market economy.

Question 10

Socialist economy-

Answer 10

The government operates as the central authority, guiding the economy & controlling(owning) many of the businesses. Goods & services are produced for use instead of profit, planned by government.

Goal is to satisfy the needs of citizens without overproduction or creating a surplus of goods.

Is slower to implement or develop technological or other changes since government approval & planning would be needed to do so.

Consumers have less access to desired goods versus those they need.

Question 11

Capitalism -

Answer 11

One form of market economy.

Characterized by privately owned businesses ( or means of production) that are in making a profit.

Question 12

What do you need in order to produce goods in a capitalist society?

Answer 12

Capital, labor & resources.

Question 13

Capital -

Answer 13

Refers to goods & tools used to make products.

Question 14

Labor -

Answer 14

Refers to human ability to produce goods or services, & include not only physical labor but also talent & skills.

Question 15

Resources -

Answer 15

Refers to things like land, minerals, forests, oil, & anything else that can be used to make goods.

Question 16

How is income produced in a capitalist society?

Answer 16

1. Through the wages that an individual earns for his/her work.
2. In the form of profit or money produced above the cost to make a product.

Question 17

Industrial Revolution -

Answer 17

Fed into capitalist economy as it allowed companies to mass produce products (which can sometimes lower the cost of producing those items & encourage consumerism)

Question 18

Anti-trust suits -

Answer 18

Used to encourage competition in a particular industry and to break up monopolies.

Question 19

Monopolies-

Answer 19

Occur when one company had complete control over a particular product or industry.

Question 20

Global trade -

Answer 20

The transportation and exchange of goods, services, resources, & money across the international borders. Allows other counties access to things that they might not have or produce in their own country & allows them to export goods or natural resources of which they have a surplus.

Question 21

Tariffs-

Answer 21

Taxes that are levied on imports/exports.

Some countries may have trade agreements that reduce or eliminate tariffs to encourage trade.

Some countries may increase tariffs in order to deter a particular good from entering another country or reduce the profits of business from other countries