Vocab 1 Flashcards
Profit
Extent to which persons or organizations are better off at the end of a period than they were at the beginning
Capitalism
Economic system in which private citizens own and use the factors of production in order to generate profits
Scarcity
Fundamental economic problem facing all societies that results from a combination of scarce resources and people’s virtually unlimited wants.
Market economy
Economic system in which supply, demand, and the price system help people make decisions and allocate resources; same as free enterprise economy
Opportunity cost
Cost of next best alternative use of time money or resources when one choice is made rather than another
Factors of production
Productive resources that make up the four categories of land, capital, labor, and entrepreneurship
Command economy
Economic system characterized by a central authority that makes most of the major economic decisions
Consumption
A
Free enterprise
Economy in which competition is allowed to flourish with a minimum of government intervention; same as private enterprise economy
Traditional economy
Economic system in which the allocation of scarce resources and other economic activity is the result of ritual, habit, or custom
Quantity
Supply of item
Mixed economy
Mixture of the three basic economic systems
Invest
Using money to help a business get started or grow with the hope that the business will earn a profit that you can share
Technology
Practical application of science to commerce or industry to produce other goods and services
Capital
Anything produced in an economy that is saved to be used to produce other goods and services
