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The flashcards below were created by user
alipeace11
on FreezingBlue Flashcards.
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resource markets
where you exchange your labor for money to spend on goods and services
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circular flow
the movement of money, products and resources between households and businesses
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competition
rivalry among businesses for the consumer's dollar
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economic growth
increased production of goods and services
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medium of exchange
a function of money that enables people to make exchanges more easily with one another
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model
a simplified representation or map of an economy
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consumers
those who buy goods and services
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price system
provides signals for what will be produced
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property right
ownership of a good or resource
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profit
money remaining after deduction costs from sales
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when resources are privately owned, how do people treat their property?
they use it carefully and productively
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what do prices usually tell businesses?
about the values consumers put on various products
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what does competition need?
scarcity
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in resource markets, businesses compete against ________________.
one another
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what does entrepreneurship do?
promote economic growth
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what are the seven goals of the US economic system?
- full employment- anyone who wants a job can get one
- economic growth- an increase in output of goods and services
- price stability-the prices of goods and services don't flucuate significantly
- economic freedom- freedom of choice in economic decisions
- economic security- the basic needs of everyone are met
- efficiency- getting the maximum output from the resources used to produce goods and services
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barter
an exchange of goods and services without using money
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money
anything that is generally accepted as payment for goods and services
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what are the three functions of money?
- medium of exchange- when people agree on the value of a good or service
- store of value- you can hold on to money for use in the future
- measure of value- the value of the money
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free enterprise
people in their economic roles are free to make choices
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specialization
a process businesses and people focus on producing one or a few parts on an entire product
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the price system
monetary prices as a message system to facilitate exchanges between buyers and sellers
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entrepreneurship
the motivation that drives business leaders to compete and react to changing conditions in the market
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What is an advantage of money as a medium of transaction?
it decreases the cost of the exchange
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If the circular flow chart were a clock, what would be at 12:00, 3:00, 6:00 and9:00?
- 12:00: product market
- 3:00: businesses
- 6:00: resource market
- 9:00: households
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Give an example of how each aspect of the US's mixed economy effects your/your family's life.
- traditional: celebrate holidays
- market: buisnesses compete for my dollar
- government: parents have to pay taxes
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