Economics Final Flashcards
(105 cards)
the study of how people seek to satisfy their needs and wants by making choices
economics
something necessary for survival; i.e. air, food, shelter, etc.
need
an item we desire but that is not necessary for survival
want
physical objects such as clothes or shoes
goods
actions or activities that one person performs for another; i.e. babysitting, haircuts, tutoring, gardening, mechanic
services
the three groups of resources that are used to make all goods and services
factors of production
What are the three factors of production?
land
labor
capital
all natural resources used to make goods and services
land
effort that people devote to a task for which they are paid
labor
any human made resource that is used to create other goods and services; there are two kinds, physical and human
capital
Give an example of physical capital.
tools, building, etc.
Give an example of human capital.
skills, knowledge, etc.
What are the three key economic questions?
- What goods and services should be produced?
- How should these goods and services be produced?
- Who consumes these goods and services?
the method used by a society to produce and distribute goods and services
economic system
economic system that relies on habit, custom or ritual to decide questions of production and consumption of goods and services
traditional economy
economic system in which decisions on production and consumption of goods and services are based on voluntary exchange in markets
market economy
economic system in which the central government makes all decisions on the production and comsumption of goods and services
centrally planned economy
economic system in which a central authority is in command of the economy; a centrally planned economy
command economy
market-based economic system with limited government involvement
mixed economy
Economy of the Soviet Union
5th Amendment
ensures private property rights
14th Amendment
protects and gives freedom for contractual agreements
16th Amendment
protection from over taxation by basing it on income
the study of the behavior and decision making of entire economies
macroeconomics