session 2 Flashcards
(26 cards)
What is Economics?
The study of how society chooses to employ resources to produce goods and services and distribute them for consumption among various competing groups and individuals.
What is Macroeconomics?
Study of national economies as a whole.
What is Microeconomics?
Study of particular people or particular markets.
What characterizes the U.S. Economy?
It is cyclical and based on the free ability to make and spend money, create a business, or seek a job.
What does the cyclical nature of the U.S. economy mean?
We have up-turns and down-turns, seasonal highs and seasonal lows within our economy.
What does GDP stand for?
Gross Domestic Product.
What is GDP?
Total value of goods and services produced in a country in a given year.
What is Per Capita GDP?
Total amount of goods and services an individual produces within a year.
What are the three prevailing kinds of economies around the world?
- Capitalism
- Socialism
- Communism
What is Capitalism?
An economic system in which all or most factors of production and distribution are privately owned and operated for profit.
What is a foundation of Capitalism regarding property?
The right to own private property.
What is a foundation of Capitalism regarding business profits?
The right to own a business and keep all the generated profits.
What is a foundation of Capitalism regarding competition?
Right to freedom of competition.
What is a foundation of Capitalism regarding choice?
The right to freedom of choice.
What is the Law of Supply?
Producers will offer (supply) more of a product for sale as its price raises and less as its price drops.
What is the Law of Demand?
Buyers will purchase (demand) more of a product as its price drops and less as its price increases.
What are the benefits and limitations of Capitalism?
Varies based on economic conditions and societal needs.
What is Socialism?
An economic system based on the premise that some, if not most, basic businesses should be owned by the government for even distribution of profits.
What is a benefit of Socialism?
Often perceived as a ‘good start’ to a developing nation.
What is a limitation of Socialism?
Difficult to mature/transform from to free markets.
What is Communism?
An economic and political system where the state makes all economic decisions and owns almost all major factors of production.
What is a benefit of Communism?
Promotes equality.
What is a limitation of Communism regarding supply and demand?
Supply and Demand not a factor in production.
What is the ‘Goss Plan’?
A five-year plan where quotas were planned and met regardless of quality and need.
