| Term | Definition |
|---|
| economy | structure of production, distribution, and consumption of theses goods and services. |
| producer | make and sell goods and services to satisfy consumer needs and wants. |
| private ownership | Refer to property and resources individuals own and control. |
| public goods | owned and controlled by government |
| productive resources | include the labor, land, factories, machinery, capital, and management skills |
| law of scarcity | all economic systems attempt to resolve the problem of limited resources and unlimited needs and wants |
| law of supply and demand | price and supply tend to follow demand |
| economic competition | Two or more sellers offer similar goods and service sales. Each seller tries to attract more customers and sales, and reap financial gain |
| monopoly | A market situation in which only one seller produces the entire output of an industry or sales a product or service for which there is no substitute. |
| antitrust laws | Laws and legal actions designed to ensure fairtrade and competition |
| fiscal policy | Government policies related to taxing and spending |
| gross domestic product | the total value of goods and services produced within a country within one year. |
| consumer price index | a measurement of price in changes of selected consumer goods and services. |
| recession | A phase in the business cycle in which economic activity declines and unemployment increases. |
| inflation | An increase in price or decrease in the value of money resulting from an increase in the amount of money in circulation relative to the amount of goods and services available. |
| monetary policy | Government policy that control the amount of money in circulation by controlling interest rates and credit terms |
| reserve requirements | Amount of cash that banks and other financial institutions must hold in reserves as a percent of their deposit. |
| discount rates | The interest rate Federal Reserve banks charge commercial banks for credit when they borrow. |
| open market operations | The buying or selling of Treasury securities and other government debt instruments in the market place by Federal Reserve. |
| international trade | The buying and selling old products and services between nations. |
| importing | buying products from another nation. |
| exporting | selling products to other nations |
| balance of payments | An account of the flow of goods,services, and money coming into and going out of the country. |
| trade deficit | When we buy more products than we sale. |
| protectionism | A policy of discouraging imports through trade barriers such as tariffs or import quota, in order to protect American businesses and jobs from foreign competition and to reduce the trade deficit. |
| trade barrier | The loss of economic power due to a country importing more than it is exporting over a period of time |
| tariff | A tax on imports that makes them more expensive for consumers. |
| import quota | A limitation on the number or quanity of imports allowed in the country. |
| exchange rate | The value of one currency compared to another. |
| euro | A new currency in Europe for noncash transactions such as credit cards, checks, and other electronic transfer. |
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