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| The study of how society chooses to employ resources to produce goods and services and distribute them for consumption among various competing groups and individuals |
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| The part of economics study that looks at the operation of a nation's economy as a whole |
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| The part of economics study that looks at hte behavior of people and organizations in particular markets |
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| The study of how to increase resources and to create the conditions that will make better use of those resources |
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| A phrase coined by Adam Smith to describe the process that turns self-directed gain into social and economic benefits for all. |
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| People who follow the idea of Economist Thomas Malthus. The idea was that evetually there will be too many peopel and too little to sustain them |
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| An economic system in which all or most of the factors of production and distribution are privately owned and operated for profit. |
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| A combination of freer markets and some government control. |
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| The Foundations of Capitalism |
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Definition
1. The right to own private property
2. The right to own a business and keep all that business's profits
3. The right to freedom of competition.
4. The right to freedom of choice. |
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| The buyers and the sellers make the decisions regarding how the market is run |
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| The quanitity of products that manufacturers of owners are willing to sell at different prices at a specific time. |
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| The quantity of products that peopel are willing to buy at different prices at a specific time |
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| The price determined by supply and demand |
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| When comparing prices of customer demand and retailer demand, the two will eventually meet somewhere. |
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| One of the four different degress of competition, perfect competition is the degree of competition in which there are many sellers in a market and none is large enough to dictate the price of a product. |
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| One of the four different degrees of competition, monopolistic competition is the degreee of competition in which a large number of sellers produce very similar products tht buyers nevertheless perceive as different. |
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| One of the four degrees of competition, oligopoly is a degree of competition in which just a few sellers dominate the market. |
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| One of the four degrees of competition, monopoly is the degree in which only one seller controls the total supply of a product or service, and sets the price. |
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| An economic system based on the premise that some, if not most, basic businesses should be owned by the government so that profits can be more evenly distributed among the people. |
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| Losing the best and brightest people to other countries. |
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| An economic and political system in which the government makes almost all economic decisions and owns almost all the major factors of production. |
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Definition
| Economic systems in which the market largely detemines what goods and services get produced, who gets them, and how the economy grows. |
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| Economic systems in which the government largely decides what goods and servies will be produced, who will get them, and how teh economy will grow. |
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| Economic systems in which some allocation of resources is made by the market and some by the government. |
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| Gross Domestic Product (GDP) |
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Definition
| The total value of final goods and services produced in a country in a given year. |
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| A measure of total sales volume at all stages of production. |
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| The number of civilians at least 16 years old who are unemployed and tried to find a job within the prior four weeks. |
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| Four Types of Unemployment |
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Definition
1. Frictional
2. Structural
3. Cyclical
4. Seasonal |
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Definition
| The general rise in the prices of goods and services over time. |
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| A situation in which prices increases are slowing (the inflation rate is declining). |
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| A situation in which prices are declining. |
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| A situation when the economy is slowing but prices are going up anyhow. |
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| Consumer Price Index (CPI) |
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Definition
| Monthly statistics that measure the pace of inflation or deflation. |
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| CPI minus food and energy costs. |
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| Producer Price Index (PPI) |
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| An index that measures prices at the wholesale level. |
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| Two or more consecutive quarters of decline the GDP |
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| A severe recession, usaully accompanied by deflation |
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| The federal government's efforts to keep the economy stable by increasing or decreasing taxes or government spending. |
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| The sum of governemnt deficits over time. |
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| Keynesian Economic Theory |
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| The theory that a government policy of increasing spending could stimulte the economy in a recession. |
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| The management of the money supply and interest rates by the Federal Reserve. |
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