the economic behavior and decision making by individuals and small business, economists look at the small picture
looks at the big picture of economics. Deals with economy as a whole and decision making from large units such as governments, industries and societies.
theory that tries to explain human economic behavior can be represented by a simplified model, scenario or other example.
way of producing the things its people want and need
economic system in which private citizens own and use the factors of production in order to seek a profit
in this system, competition is allowed to flourish, with minimal government interference, ex. US economy allows us to collect wealth and is successful
places where prices of goods and services are determined as exchange takes place, connects different sectors of economy
"to let alone" it is a philosophy saying that government should not interfere with the marketplace and is confined to ensuring free competition.
decisions are made based on supply and demand
per Capit GDP
total GDP divided by the country's population
decisions are made by central government, individual has little/no say in government
belief that the means of production should be owned and controlled by society, either directly or through the government
What is the main reason for shifting to a market system in countries?
Major market economies have been extremely successful. other countries hope to bring same success to their own country
countries whose average per Capita gpa is a fraction of that in industrialized countries
economic decisions are based on custom or habit. ex grandparents baked for a living, you will too,
What did the Middle Colonies produce? What industries did they have?
Wheat, sawmills, mines, ironworks
What did the southern colonies produce? What industries did they have?
Agriculture and prodcuts, tobacco, rice, indigo, grain
What indistries did the northern colonies have? What did they produce?
Shipbuilding, whaling, fishing, small buisnessess, shopkeepers, shoemakers, milling grain, sewing clothes
describing the consumer as the "king" or "ruler" of the market because they determine what products will be produced due to the effort to try and match products to wants
private property rights
we have the right to dispose of our property as long as we do not interfere with the rights of others. Private porperty rights give us incentive to work, do, save and invest because we keep gains we earn.
struggle between buyers and sellers
money left over after costs have been paid
driving force that encourages individuals and organizations to improve their material well-being
act of buyers and sellers freely and willingly engaging in market transactions
SOMEONE WHO BUYS A PRODUCT OR SERVICE
money remaining after all taxes on it have been paid
money remaining after paying for necessities, can be used for buying wants
movement to educate buyers about the purchases they make and to demand better and safer products from manufacturers
Food, Drug and Cosmetic Act
Requires packages to list their ingredients according to the amount of each.
Pure Food and Drug act
Requires manufacturers of foods, cosmetics and drugs to prove they are safe
Consumer Bill Of Rights
1. Right to A Safe Product
2. Right to be informed (protection against misleading info)
3.right to choose
4.right ot be heard (consumer interests will be heard when laws are being written)
5. right to redress (consumers can recieve money if product causes damage)
smart shopping strategy eg, read advertisements, visit different stores, look at brand name and generic products, look at alternative methods of making a purchase
buisness owned by one person
money needed to run a buisiness or enable it to grow larger
all partners are responsible for management and financial capital of buisnessess
at least one partner is not active in the daily running of the buisiness, although he/she may have contributed funds
markets where productive resources are bought and sold
markets where producers offer goods and services for sale
how does government sector play a role in the economic decision making process?
government recieves revenue from taxes and uses them to purchase final goods and servies in product markets, purchases productive inputs
measure of the amount of output produced by a given level of input
division of labor
breaking down a job into small tasks performed by different workers
we rely on others and others rely on us
products used together
extent to which a change in price causes a change in the quantity demanded
law of demand
quantity demanded and price more in opposite directions
graph that shows the amount of a product that would be bought at all possible prices in the market
table that lists the various quantities of a product or service that someone is willing ot buy over a range of prices
total demand of all consumers for their product or service
meaning the pleasure, usefulness or satisfaction we get from using the product, a good or service does not have to have utility for everyone.
refers to various quantities of a good or servie that producers are willing to sell at all possible market prices
law of supply
principle that suppliers will normally offer more for sale at higher prices and less at lower prices
NUMERICAL CHART ILLISTRAING SUPPLY SCEDULE
graph that shows the amount of a product that would be supplied at all possible prices in the market
combination of supply scedules of all buisinesses that provide the same good or service
measure of how quantity supplied of a good or service changes in response to changes in price
maximum price set by government that can be charged for goods and services
government minimum that can be charged for goods and services
set aside income for a later time
partial ownership of a company
payment from a portion of company earnings
lending money to a company or government
pools of money from many people
considered dafest of all bonds, builds interest at redemption price