Flashcards About Econ unit 1
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any resources that are made by humans and used to create other goods and services
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capital
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resources used to make all goods and services
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factors of production
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purpose of production possibilities graph
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show alternative ways to use an economy's resources
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production possibilities frontiers curve when they are charted on a graph because they show
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the increasing costs resulting in increasingly less output
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kind of decision that can be made at the margin
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whether or not to hire new workers
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what makes someone an entrepreneur
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running a service that hires people to install sprinkler systems in lawns
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what is not a characteristic of a centrally planned economy
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each collective or factory sets its own goals
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what does the process of specialization do for an economy?
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it makes it more efficient
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how could the chinese's economy be characterized
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mixed, but on the side of centrally planned
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what is the product market
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a market in which households purchase the goods and services that firms produce
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what is a condition that the safety net of the government would NOT cover
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stock market decline
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leader that introduced communism and central planning to the former soviet union
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vladimir Lenin
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what is a private organization that attempts to influence public officials to act or vote in ways that will benefit the group's members
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special interest group
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what is a positive externality
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an economic side effect that generates unexpected benefits
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difference between business cycle and the day to day ups and downs of the market
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a business cycle is a major, prolonged fluctuation rather than a day to day movement
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critical rule for determining whether something is a public good
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total benefits to society are greater than the total cost
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what is NOT an example of a public good
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shopping malls
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what best describes the role of government in a free enterprise system
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allow individuals to operate their businesses in ways they think will maximize their profits
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how do consumers make their desires known to businesses most effectively
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through buying products
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why does the government require businesses to disclose so much information to the public
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to make buyers more knowledgeable and safer
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opportunity cost
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opportunity cost is when the desired choice is given up for an alternative. For example, during free period i could have relaxed with friends but instead i studied for my econ test
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profit motive
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profit motive is the motive behind free market and market but especially free market. Buyers want to save money and sellers want to make money
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law of increasing cost
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this means that is a certain product increases in cost than another product must decrease. this leads to an increase in opportunity cost
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socialism
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is a form of government. it is a controlled market where the government as complete control and everyone is equal. there is economic equality
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free-rider
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a free rider is someone who uses foods they didnt pay for. for example someone using a county park without living in that county
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gross domestic product
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GDP is the money value of all final products/services produced in within a country's borders in a year
