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where you exchange your labor for money to spend on goods and services
the movement of money, products and resources between households and businesses
rivalry among businesses for the consumer's dollar
increased production of goods and services
medium of exchange
a function of money that enables people to make exchanges more easily with one another
a simplified representation or map of an economy
those who buy goods and services
provides signals for what will be produced
ownership of a good or resource
money remaining after deduction costs from sales
when resources are privately owned, how do people treat their property?
they use it carefully and productively
what do prices usually tell businesses?
about the values consumers put on various products
what does competition need?
in resource markets, businesses compete against ________________.
what does entrepreneurship do?
promote economic growth
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
an exchange of goods and services without using money
anything that is generally accepted as payment for goods and services
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
people in their economic roles are free to make choices
a process businesses and people focus on producing one or a few parts on an entire product
the price system
monetary prices as a message system to facilitate exchanges between buyers and sellers
the motivation that drives business leaders to compete and react to changing conditions in the market
What is an advantage of money as a medium of transaction?
it decreases the cost of the exchange
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
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