Economics Chapter 2 Terms – Productive Resources and Economic Systems – Flashcards
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productive resources
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anything that can be used to create or manufacture valuable goods or services
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factors of production
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resources that are used to produce goods and services
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land
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all natural resources found on or below the surface
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raw materials
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all natural resources used in production
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labour
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a factor of production comprising the physical and mental effort contributed by people to producing goods and services
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entrepreneurship and knowledge
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two important factors of production that allow for the more efficient use of land, raw materials, labour, and capital
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entrepreneurship
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the ability to organize economic activity, assume risks, and achieve effective results
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capital
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the goods that aid in the production of other goods and services
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capital
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the type of resources which includes factories, warehouses, machinery, and equipment
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money capital
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the money available in an enterprise to acquire necesary goods
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real capital
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the type of capital which facilities, machinery, and equipment belong to
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real capital
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this type of resource is extremely important to a growing economy
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productivity
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a firm's ability to maximuze output from the resources available, usually measured as the firm's output per worker
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tangible resources
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resources that have physical properties that can be seen and touched and are therefore easily quantified
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intangible resources
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resources that lack the physical properties that make them easy to quantify
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entrepreneurship
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an important intangible resource that directly affects national productivity
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knowledge
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an increasingly important intangible resource which gives Canada's transformation from a manufacturing economy to an information economy
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environment for enterprise
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a society's social values and institutions, such as stable government, that are favourable to businesses attempting to produce and sell goods and services
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tangible and intangible resources
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what work together to form the real source of a nation's wealth and prosperity
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the sum total of tangible and intangible productive resources
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a clear indicator of economic wealth and the cornerstone of long-term growth and prosperity
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market value
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the dollar value that a product will be worth in the marketplace
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value added
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the increase in market value resulting from the additional processing or refinement of the product
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what, how, and for whom to produce
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the three questions economic systems answer
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economic system
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the set of laws, institutions, and common practices that help a nation determine how to use its scarce resoures to satisfy as many of its people's needs and wants as possible
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traditional economy
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an economic system in which production decisions are determined by the practices of the past
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traditional economy
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which economic system does this characteristic belong to: geographic isolation
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traditional economy
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which economic system does this characteristic belong to: subsistence; people engage in little long-term planning and focus primarily on surviving the challenges of each day
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traditional economy
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which economic system does this characteristic belong to: reliance on traditional practices and sklls
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traditional economy
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which economic system does this characteristic belong to: self-sufficiency
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barter
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the trading of goods and services without the use of a monetary system; such trasactions are common in traditional economies
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traditional economy
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the most common economic system throughout the most of the world centuries ago
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traditional economy
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which economic system do these societies belong to: the Bedouin of the Sahara Desert, the Bushmen of the Kalahari Desert, the Mongols of the Gobi Desert
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command economy
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an economic system in which production decisions are made by central planners
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command economy
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which economic system does this characteristic belong to: everything is determined by central authority
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command economy
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which economic system does this characteristic belong to: state-owned properties
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command economy
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which economic system does this characteristic belong to: equitable distribution of income and wealth
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command economy
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which economic system does this characteristic belong to: bureacratic and inflexible
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command economy
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which economic system does this characteristic belong to: limited individual choice, incentive, and initiative
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command economy
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which economic system does this characteristic belong to: limited availability of consumer goods
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command economy
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which economic system does this characteristic belong to: rewards and punishments
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market economy
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an economic system in which production decisions are made by the actions of buyers and sellers in the marketplace
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market economy
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which economic system does this characteristic belong to: private property
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market economy
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which economic system does this characteristic belong to: freedom of enterprise
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market economy
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which economic system does this characteristic belong to: profit-driven
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market economy
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which economic system does this characteristic belong to: competition
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free enterprise
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the system in which people are acting for themselves, often out of self-interest
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private enterprise
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the system in which resources are privately owned
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mixed economy
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an economic system that contains elements of market, command, and traditional systems
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mixed market economy
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the economic system which Canada has
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crown land
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a Canadian term for government-owned land
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hidden economy
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the growing practice in Canada and other mixed economies of citizens trading one service for another to avoid taxation or to ensure a more personal level of services
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underground economy
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another name for hidden economy
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democracy
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a political system characterized by a freely elected government that represents the majority of citizens
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democracy
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the type of political system that is open to many parties or political views
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dictatorship
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a political system in which a single person or party exercises absolute authority over an entire nation
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dictatorship
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the type of political system where no free elections are allowed for people to change their leader
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Karl Marx
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the father of communism
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communism
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a political system on the extreme left, based upon the theories of Karl Marx, that calls for government or community ownership of the means of production
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Soviet Union
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a historical example of a communist country
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socialism
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a political system of the moderate left that calls for public ownership of the principal means of production, to be achieved in a democratic and peaceful manner
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Scandinavian countries
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where free-enterprise socialism is practiced most successfully in the world; these countries have the highest standards of living in the world
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nationalization
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another term for state ownership of business enterprise
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capitalism
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an economy characterized by private ownership of business and industry, the profit motive, and free markets; it occupies the moderate right position of the political spectrum
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Adam Smith
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the father of capitalism
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welfare capitalism
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capitalist system blended with some socialist characteristics, such as welfare programs and government-owned enterprise
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fascism
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a political system on the extreme right, combining a free-market economy with a non-democratic form of government
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Nazi Germany
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a historical example of fascism
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complementary economic goals
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reaching one goal makes another goal easier to achieve
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conflicting economic goals
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reaching one goal makes another goal more difficult to achieve
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public debt
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the total debt held by federal and provincial governments accumulated from their past borrowings, on which interest must be paid
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economic growth
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an increase in an economy
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transfer payments
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direct payments from governments to other governments or to individuals; a mechanism for providing social security, income support, and allviation of regional disparities
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inflation
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a general rise in prices
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deflation
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a general fall in prices
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poverty
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the issue that is at the heart of equitable distribution of income
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full employment
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between 6% to 7% of the labour force being out of work
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labour force
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the total of all Canadians holding jobs plus all those actively seeking work
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balance of payments account
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national account of international payments and receipts, devided into current account, and capital and financial account
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stable currency
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which economic goal can be achieved if imports balance exports
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economic freedom
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the freedom of choice available to workers, consumers, and investors in the economy
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consumer sovereignty
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a principle stating that, in a market economy, people should be free to choose when and how to consume, save, or invest their money
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environmental stewardship
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an economic goal which aims that economic activity must be carried out without significantly harming the natural environment
