1.
$250,000: FDIC currently insures individual bank accounts up to
2.
amoral: having no understanding or value of right and wrong
3.
Baby Steps: the seven steps to a healthy financial plan
4.
capital goods: Manufactured goods needed to produce other goods & services
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central gov't planning.: The free enterprise economy would not thrive on
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competition: An important characteristic of free enterprise
7.
Compound Interest: interest paid on interest previously earned; credited regularly on both the principal and previously earned interest.
8.
contentment: a state of being satisfied and at peace with one's situation in life
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depression: Acute shortages, high unemployment, & excess capacity at manufacturing facilities
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disposable personable income: Amount of money the consumer sector of the economy has available for spending after personal income taxes are deducted
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emergency fund: available money to be used only for emergencies; equal to income of 3-6 months
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equals marginal cost.: Profits will be maximized when marginal revenue
13.
expansion: After passing through a trough, the business cycle enters a period of
14.
factor markets: Factors of production are bought & sold in
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factors of production.: Land, Labor, and entrepreneurs are
16.
Federal Open Market Committee: Advises the Fed on growth of money supply & level of interests rates
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fixed & variable costs.: Total cost is the sum of the
18.
flat money: Money by government decree is known as
19.
Gross Domestic Product (GDP): $ value of all final goods, services, structures produced within a country
20.
horizontal merger: When two corporations that produce the same kind of product merge
21.
impulse: a sudden desire to do something; no planning involved
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Individual income tax: Single most important source of revenue for the national government
23.
inelastic.: Modest price increase for an item with little effect on demand indicates that demand for the product is
24.
interest (savings): additional money earned by having money in an account
25.
interest rate: percent of money paid to a lender for the use of borrowed money.
26.
marathon: a footrace of 26 miles 385 yards; used to describe a challenge of a great distance or effort at a slower pace
27.
market theory of wage determination: Theory that wages are based on the supply & demand for a worker's skills
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maximize profits: The primary purpose of financial planning is to
29.
microeconomics: The study of the economic behavior of individuals & firms
30.
modified free enterprise: Today the American economy is an example of
31.
Money Market: mutual fund that seeks to maintain a stable share price and to earn current income by investing in interest-bearing instruments with short-term (usually 90 days or less) maturities.
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NAFTA: reduced tariffs among United States, Canada, and Mexico
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nations engaged in trade.: Absolute and comparative advantage are terms related to
34.
paradox of value: Some necessities have little value while some non-necessities have much higher value
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payroll taxes: Taxes levied on employers and employees to pay for Social Security & Medicare
36.
principal: the original amount of money added to an account on which interest is calculated.
37.
producers to offer more and consumers to buy less.: In a market economy, the high price is a signal for
38.
protect domestic industry.: Trade barriers are enacted to
39.
Sinking Fund: Saving money for a specific purpose to allow interest to work for you rather than against you.
40.
start new businesses.: Entrepreneurs are considered the driving force in an economy because they
41.
the federal budget: Annual plan for outlining proposed revenues & expenditures for the coming year is
42.
the substitute effect: Consumers' willingness to replace a costly item wt one that is less costly
43.
unlimited wants & limited resources: Economics tries to solve problem of how to satisfy
44.
unskilled labor: Laborers who lack training and skills
45.
variable costs: Costs for electricity, shipping & labor are examples of
46.
vertical integration: When corporations involved in different steps of making a product merge
