Unit 1 - The capitalist revolution, key terms

Question 1

Economics

Answer 1

The study of how people interact with each other and with their natural surroundings in providing their livelihoods, and how this changes over time

Question 2

Industrial revolution

Answer 2

A wave of technological advances and organizational changes starting in Britain in the 18th century, which transformed an agrarian and craft-based economy into a commercial and industial economy

Question 3

Technology

Answer 3

The description of a process using a set of materials and other inputs, including the work of people and machines, to produce and output

Question 4

Economic system

Answer 4

A way of organizing the economy that is distinctive in its basic istitutions. Economic systems of the past and present include: central economic planning, feudalism, slave economy and capitalism

Question 5

Capitalism

Answer 5

An economic system in which the main form of economic organization is the firm, in which the private owners of capital goods hire labour to produce goods and services for sale on markets with the intent of making a profit. The main economic institutions in a capitalist economic system then, are private property, markets, and firms

Question 6

Insititution

Answer 6

The laws and informal rules that regulate social interactions among people and between people and the biosphere

Question 7

Private property

Answer 7

When the person possessing it has the right to exclude others from it, to benefit from the use of it and to exchange it with others

Question 8

Market

Answer 8

A way that people exchange goods and services by means of directly reciprocated transfers (unlike gifts), voluntarily entered into for mutual benefit (unlike theft, taxation), that is often impersonal (unlike transfers among friends/family)

Question 9

Firm

Answer 9

Economic organization in which private owners of capital goods hire and direct labour to produce goods and services for sale on markets

Question 10

Capitalist revolution

Answer 10

Rapid improvements in technology combined with the emergence of a new economic system

Question 11

Democracy

Answer 11

A political system, that ideally gives equal political power to all citizens, defined by individual rights such as freedom of speech and the press; fair elections in which virtually all adults are eligible to vote; and in which the government leaves office if it loses