question

Private Want

answer

something desired but not needed, like an iPhone or Corvette

question

Public Want

answer

shared by many people - like roads, parks, and clean water

question

Goods

answer

tangible, material thing that can be seen and touched

question

Service

answer

a task that others do for us - such as an oil change

question

Business

answer

seeks profits by providing us with goods and services

question

Caveat Emptor

answer

Latin for "let the buyer beware"

question

Competetion

answer

the contest between businesses to win customers

question

Standard of Living

answer

the amount of goods and services the average citizen can purchase

question

Human Resources

answer

the knowledge, effort, and skills people bring to work

question

Scarcity

answer

society's shortage of resources; what every nation faces

question

Capital resources

answer

include buildings, equipment, factories and tools

question

Market Economy (Capitalism)

answer

consumers make key decisions about supply and demand (USA)

question

Command Economy

answer

system where the government makes all key decisions (Cuba, China)

question

Demand

answer

Amount of goods and services consumers will buy at certain prices

question

Supply

answer

amount of goods and services producers will provide at certain prices

question

Nonrenewable Resources

answer

limited resources that include oil and iron

question

Renewable Resources

answer

resources that can be reproduced

question

Factors of Production

answer

the four resources used to produce goods and services (natural, human, capital, and entrepreneurs)

question

Opportunity Costs

answer

what we lose by making a particular decision (party vs. study)

question

Entrepreneurial Resources

answer

initiative to improve goods or services to meet changing needs and wants of consumers (Bill Gates, Henry Ford, Thomas Edison)

question

Mixed Economy

answer

combines market and command economies

question

Complements

answer

goods or services that are used along with another good or service like hot dog with mustard or ketchup

question

Substitutes

answer

good or service that can replace a another good or service (like Pepsi instead of Coke or hamburger instead of hot dog)

question

Demand Curve

answer

downward sloping (D in demand for D in downward)

question

Supply Curve

answer

upward sloping

question

Quantity Demanded (QD)

answer

movement along the demand curve (price is only factor that affects both QD and QS)

question

Quantity Supplied (QS)

answer

movement along the supply curve

question

Demand Increase

answer

The demand curve will shift to the right if this happens

question

Demand Decrease

answer

The demand curve will shift to the left if this happens

question

Supply Increase

answer

The supply curve will shift to the right if this happens

question

Supply Decrease

answer

The supply curve will shift to the left if this happens

question

Gross Domestic Product (GDP)

answer

monetary value of all goods and services produced in the U.S. for one year. Higher of this equates to a higher standard of living

question

Prosperity

answer

The peak of economic activity characterized by low unemployment and high GDP

question

Temporary Unemployment

answer

examples are if you are between jobs and you quit a job

question

Seasonal Unemployment

answer

Examples include lifeguards, landscapers, caddies, and ski-lift operators

question

Technological Unemployment

answer

comes about as a result of technology that displaces or outright replaces workers

question

Cyclical Unemployment

answer

due to lay-offs, plant-closings, and a fall in GDP; corporate down-sizing leads to a higher unemployment

question

Inflation

answer

A general rise in the price of goods and services

question

Budget Deficit

answer

When government spending is higher than revenues

question

Ripple Effect

answer

When a recession spreads from one industry to the other

question

Budget Surplus

answer

When government revenues are greater than spending

question

Income Taxes

answer

the main source of government revenues

question

Business Cycle

answer

The repeated rise and fall of economic activity over time

question

Economic Indicators

answer

measures of economic performance - include GDP and inflation rate

question

National Debt

answer

The total amount of money that the government owes

question

Standard of Living

answer

the amount of goods and services the average citizen can buy

question

GDP Exclusions

answer

include used goods, intermediate goods, underground/illegal activity

question

Personal Ethics

answer

examples include not cheating on a test, don't steal

question

Social Ethics

answer

examples include recycling and volunteering at a homeless shelter

question

Environmental Protection Act (EPA)

answer

federal agency that enforces rules that control pollution and protect the environment

question

Food and Drug Administration (FDA)

answer

Government agency that protects consumers from dangerous or falsely advertised goods, ensures proper labels, tests new drugs

question

Federal Trade Commission (FTC)

answer

federal agency that ensures fair competition and prohibits unfair trade/business practices, regulates interstate trade

question

Small Business

answer

Fewer than 500 employees, accounts for over 50% of the total workforce and national income, serves a limited geographical area

question

Entrepreneurship Advantages

answer

include personal satisfaction of doing something you like, you can often work at home, flexible hours

question

Entrepreneurship Disdvantages

answer

You are 100% responsible for the business, you often work long hours,and the financial risks are YOURS

question

Small Business Advantages

answer

include you're the boss, and they are easy to start up/form

question

Small Business Disadvantages

answer

You are alone making decisions, competing with the bigger stores/chains is difficult, the failure rate is high

question

Main Reason Small Businesses Fail

answer

The don't have adequate managerial skills

question

Federal Government

answer

is the country's largest employer and largest consumer

question

Government Services

answer

include public protection, public education, and courts

question

Government Expenditures

answer

The majority is spent on transfer payments (social security, welfare)

question

Social Needs

answer

include parks, recreation, and libraries

question

Subsidy

answer

government payment to a business to make up for its losses

question

Monopoly

answer

Occurs when one company controls an entire industry

question

Oligopoly

answer

A small number of firms controlling a market - Like Computers - Apple, Dell, Microsoft

question

Copyright

answer

protects an author's work for his entire lifetime plus 50-70 years

question

Intrastate Trade/Commerce

answer

Business trade within one state regulated by the state itself as stated in the 10th Ammednment

question

Trust/Anti-trust Laws

answer

protect competition among companies

question

Interest

answer

rate charged for use of money; rate banks pay you for keeping money in a savings or checking account

question

Credit Union

answer

a non-profit bank set up by an organization for members to use

question

Federal Reserve

answer

The central bank of the US, it supplies paper currency to our government

question

Ben Bernanke

answer

current Federal Reserve chairsperson

question

Store of Value

answer

a function of money, it keeps value over time; accumulate dollars to increase one's wealth

question

Standard of Value

answer

a function of money, it is a way for measuring the value of goods

question

Line of Credit

answer

money set aside "on demand" for preferred bank customers

question

Safety Deposit Box

answer

something to place valuables in at the bank

question

Characteristics of Money

answer

stable, accepted, divisible, portable, durable, and difficult to counterfeit

question

Insurance Company

answer

provides protection against things such as fire and theft

question

Commercial Bank

answer

often referred to as a "full service" bank

question

Channel of Distribution

answer

a way to direct products to customers

question

Promotion

answer

making customers aware of a product; advertising is the #1 way

question

Publicity

answer

free advertising for a good like a news story or a magazine article

question

Marketing mix

answer

the four P's that go into selling goods: Product, place, and promotion

question

Marketing concept

answer

the need for businesses to know the wants and needs of customers in order to make a profit

question

Retailer

answer

sells goods directly to the customer for personal use

question

Wholesaler

answer

buys large quantities from manufacturers, resells them to businesses for a profit

question

Gimmicks

answer

ways to promote goods such as coupons, rebates, sales, free samples

question

Fads

answer

goods that are "in and out of style" and can become outdated quickly, such as pet rock, pogo sticks, "Yu-Gio cards", bell-bottom jeans, etc.

question

Broadcast media

answer

the most effective means of advertising using radio and television

question

Direct-mail ads

answer

often called, "junk" mail; fewer than 1% of homes read or use

question

Billboards

answer

most common form of outdoor advertising,; banned in some states

question

Infomercial

answer

a television program that sells a product

question

TV ads

answer

most expensive form of advertising, it has an advantage over other forms due to sound, images, and motion; local stations are cheaper to use than national networks

question

Directory ads

answer

phone book advertisements; one disadvantage is all the ads look identical; advantages are they are cheap and good for one year

question

Transit ads

answer

public transportation is used to display this type of ad; mostly in urban areas

question

Pop-up Ads

answer

Internet ads appearing briefly when user logs onto a site

question

Newspapers

answer

The main method of advertising in the US according to the textbook

question

Radio Advertising Advantages

answer

include music, dialogue, and sound effects to get the audience's attention; it reaches people on the move like joggers and people driving in a car

question

Start-up budget

answer

a plan for income and expenses from the time you start the business until it becomes profitable

question

Balance Sheet

answer

reports assets, liabilities, and owner's net equity at a specific time (also referred to as the "financial state" of your business)

question

Income statement

answer

a report of net income or net loss over an accounting period

question

Asset

answer

any property or item of value a business owns such as cash, equipment, buildings, and land

question

Liability

answer

any amount of money a business owes

question

Budget

answer

a written plan of expected income and expenses which enables you to control spending

question

Fiscal year

answer

a one-year accounting period for a company

question

Career information sources

answer

can include your school counselors, teachers, the want ads, your neighbors, and even your own family

question

Networking

answer

this consists of meeting and talking to people in different occupations to find out what they do and to make connections

question

Shadowing

answer

involves accompanying an employee to work for a day to see what his/her position involves

question

Profession

answer

a field that requires a high level of education such as law, medicine, or architecture

question

Apprenticeship

answer

this involves working under a skilled worker to learn a trade

question

Internship

answer

a program that provides "hands-on" experience for a beginner in an occupation, usually as an unpaid trainee

question

Job Market/Career Trends

answer

include an increased need for health care workers and people with computer skills

question

Technology

answer

plays an important role in the workplace because it increases worker productivity

question

Your Network

answer

often the best source of Job leads, this is where you also get personal recommendations and referrals

question

Good attendance and attitude

answer

when looking at high school records, employers tend to focus the most on this

question

Professional Reference

answer

this can be written by a former employer or college professor -- not family members

question

Personal Reference

answer

testifies to an applicant's character and can be written by old friends, a priest, or a neighbor

question

Resume

answer

a summary of our skills, education, and work experience

question

Employability skills

answer

employers expect applicants to have basic skills including communication, computer knowledge, and mathematics

question

Qualifications

answer

education, skills, and work experience to do a particular job

question

Employment agency

answer

a service, where there is usually a fee, that helps people find jobs

question

Rational advertising

answer

attempts to convince you to buy with facts and other information

question

Emotional adveritsing

answer

appeals to your feelings; "wonderful things" will happen if you buy this product

question

Brand name

answer

a word, logo, or picture on a product that helps the consumer distinguish it from other products such as Pepsi, Kleenex, and Nike

question

Generic

answer

"No frill packaging," often called store brands, which cost up to 40% less than name brand

question

Promotional sale

answer

are often used to introduce a new product an can be tied to the holidays

question

Clearance sales

answer

are often used to move "out of season", no longer profitable items

question

Impulse buying

answer

this leads to buying things that you don't really need on the "spur" of the moment and can ruin your credit rating and budget

question

Limited-line retailers

answer

specialty store that generally sell one type of product -- ,like Foot Locker, Ace Hardware

question

Department stores

answer

these include J.C. Penney's, Macy's, and Nordstroms

question

Limited warranty

answer

covers only parts of a product for repair for a certain period of time

question

Consumer

answer

a person who selects, purchases, and disposes of goods and services

question

Outlet store

answer

sell brand-name goods that are discontinued and could have flaws; often called "off-price" stores, such as Birch Run and Tanger Outlets

question

Full Warranty

answer

covers replacement or repair of a product for 90 days to one year

question

Consumer Bill of Rights

answer

introduced in 1962 by President John F. Kennedy

question

Right to be Informed

answer

the right to accurate information to make intelligent choices

question

Right to Choose

answer

the right to free choice among many product choices, low prices, high quality, excellent service

question

Right to Safety

answer

consumers want to know the product won't harm them, extensive testing by the FDA, warnings and directions for proper use on labels

question

Right to be Heard

answer

the right to go and complain to customer service or to write to the manufacturer

question

Right to Have Problems Corrected

answer

if defective, replace or refund money, if necessary... sue

question

Right to Consumer Education

answer

to acquire knowledge in order to make informed, confident choices about goods and services; Consumer Reports is a great magazine for information

question

Right to Service

answer

to be treated correctly without discrimination

question

Recycling

answer

involves collecting products for processing so that they can be reused

question

Bait and Switch Advertising

answer

advertising a product at a low price to lure customers into a store, and then telling the customer that the store is out of the product -- hoping that they will buy more expensive goods

question

Conservation

answer

deals with the issue of limited resources

question

Federal Trade Commission

answer

prohibits unfair trade practices including deceptive advertising and unfair pricing

question

National Highway Traffic Safety

answer

government agency that deals with automobile recalls

question

Fraud

answer

a deliberately misleading business practice such as selling used goods as new

question

Caveat Venditor

answer

Latin phrase meaning, "Let the vendor beware"

question

Caveat Emptor

answer

Latin phrase meaning, "let the buyer beware"

question

Single-purpose card

answer

credit card that can only be used at the business issuing it

question

Consumer credit

answer

this type of credit is used by people for personal reasons

question

Charge accounts

answer

short-term and medium-term credit offered by stores and dealers

question

Mortgage

answer

a 15-30 year installment loan usually for a house paid in regular monthly payments

question

Cost of Credit

answer

the most important factor is the risk a creditor loaning money takes

question

Debtor

answer

Person borrowing money or credit

question

Creditor

answer

person who lends money or provides credit

question

Credit rating

answer

includes things such as one's income, current debt, and debt history which measures his/her ability to repay a loan

question

Entertainment card

answer

includes Diners Club and American Express -- used for travel and business

question

Revolving Credit

answer

a charge account that allows you to charge up to a certain amount and pack back a part of what you owe each month

question

Credit

answer

an agreement to get money, goods, or services now in exchange for a promise to pay later

question

Capacity

answer

One of the first things a lender considers before lending money; it includes do you have money in the bank, a good job, or good income

question

Character

answer

Before lending you money, banks want to know what kind of person you are, you're an honor student and an eagle scout

question

Capital

answer

You have nine months' salary saved, own stock in four corporations, and own land

question

Finance charge

answer

The total amount it costs to finance a loan in dollars and cents

question

Garnishment

answer

When a creditor takes all or part of your paycheck if you miss credit card or loan payments

question

Repossess

answer

A creditors legal right to take back the collateral

question

Variable rate

answer

A type of loan where the interest changes

question

Fixed rate

answer

A type of loan where the interest remains the same

question

Cosigner

answer

Someone who agrees to be responsible for your loan payments if you don't pay

question

Unsecured loan

answer

A loan not backed with a collateral

question

Secured loan

answer

A loan backed by a cosigner or a collateral

question

Grace period

answer

Amount of time to pay a debt without having to pay interest charges

question

Installment loan

answer

Pay a set amount of money up front and the balance in equal monthly payments, which include interest, ie. for a car or home

question

Collection agent

answer

Person or business that collects overdue bills; limited in what he can say or do, cannot discuss your debt with neighbors, family, coworkers

question

Federal Trade Commission

answer

Government agency that enforces laws on credit

question

Fair Credit Billing Act

answer

Requires creditors to correct mistakes brought to their attention by debtors

question

Equal Credit Opportunity Act

answer

A law against denying someone credit based upon gender, age, ethnicity, or religion

question

Consolidation loans

answer

Combines several debts into one loan with lower payments but higher interest rates

question

Fair Credit Reporting Act

answer

Gives you the right to know what is in your credit file

question

Truth in lending disclosure

answer

Requires the creditor to give the borrower information about all the costs of borrowing money

question

Credit counselor

answer

Helps consumers with their credit problems by giving advice

question

Fair Debt Collection Practices Act

answer

Protects debtors by prohibiting unfair debt collection practices and methods by collection agents

question

Bankruptcy

answer

When the debtor is relieved of debts, often referred to as the last resort because the debtor is left with a horrible credit record

question

Consumer Credit Protection Act

answer

Part of truth in lending, creditors must supply credit info to consumers, also, if a a credit card is stolen or lost, consumer is only $50 worth of fraudulent charges

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