Chapter 1 Flashcards
(39 cards)
Business
individuals or organization who try to earn a profit by providing products that satisfy peoples needs
Products
a good or service with tangible and intangible characteristics that provide satisfaction and benefits
Profit
the difference between what it costs to make and sell a product and what a customer pays for it
Nonprofit Organizations
Organizations that may provide goods and services but do not have the fundamental purpose of earning profits
Stakeholders
groups that have a stake in the success and outcomes of a business
Economics
the study of how resources are distributed for the production of goods and services within a social system
Natural Resources
land, forests, minerals, water, and other things that are not made by people
Human Resources (Labor)
the physical and mental abilities that people use to produce goods and services
Financial Resources (Capital)
the funds used to acquire the natural and human resources needed to provide products
Economic System
a description of how a particular society distributes its resources to produce goods and services
Communism
first described by Karl Marx as a society in which the people, without regard to class, own all the nations resources
Socialism
an economic system in which government owns and operates basic industries but individuals own most businesses
Capitalism (Free Enterprise)
an economic system in which individuals own and operate the majority of the businesses that provide goods and services
Free-Market System
pure capitalism, in which all economic decisions are made without government intervention
Mixed Economies
economies made up of elements from more than one economic system
Demand
the number of goods and services that consumers are willing to buy at different prices at a specific time
Supply
the number of products - goods and services - that businesses are willing to sell at different prices at a specific time
Equilibrium Price
the price at which the number of products that businesses are willing to supply equals the number of products consumers are willing to buy at a specific point in time
Competition
the rivalry among businesses for the consumers dollar
Pure Competition
the market structure that exists when there are many small businesses selling one standardized product
Monopolistic Competition
the market structure that exists when there are fewer businesses than in a pure competition environment and the differences among the goods they sell are small
Oligopoly
the market structure that exists when there are very few businesses selling a product
Monopoly
the market structure that exists when there is only one business providing a product in a given market
Economic Expansion
the situation that occurs when an economy is growing and people are spending more money; their purchases stimulate the production of goods and services, which in turn stimulates employment
