All Civics Chapters
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85 terms
Terms | Definitions |
|---|---|
 needs | are required for survival example: food. clothing, shelter, |
| wants | things we would like to have, they make life more comfortable and enjoyable example: entertainment, vacation |
| economics | the study of how we make decisions in a world in which resources are limited |
| microeconomics | when you look at the small picture such as individuals and businesses |
| macroeconomics | looks at the big picture also looks at the economy as a hole such as governments and whole societies or industries |
| economic model | theory that tries to explain human economic behavior |
| economic system | way of producing the things its people want and need |
| resources | the things used in making goods and providing services |
| scarcity | occurs whenever we do not have enough resources to produce all the things we would like to have |
| trade-off | alternative you face if you decide to do one thing rather than another |
| opportunity cost | cost of the next best use of your time or money when you choose to do one thing rather than another |
| marginal cost | additional cost of prouducing one additional unit of output |
| marginal benefit | additional satisfaction or benefit recieved when one more unit is produced |
| cost-benefit analysis | compares the marginal benefit against the marginal cost, tells us to choose an action when teh benefits are greater then the costs |
| Goods | books and automobiles |
| services | work performed for someone else |
| factors of production | resources necessary to produce goods and services, four factors |
| natural resources | first factor refers to all the 'gifts of nature' that make production possible |
| labor | the nation's workforce= human resources |
| capital | which are the manufactured goods used to make other goods and services |
| entrepreneur | an individual who starts a new business, introduces new products, and improves processes |
| Gross Domestic Product (GDP) | total value in dollars of all the final goods and services produced in a country during a single year |
| standard of living | quality of life based on the possession of the necessities and luxuries that make life easier |
| market | free an willing exchange of goods and services between buyers and sellers |
| factor markets | the markets where productive resources are bought and sold |
| product market | markets where producers offer goods and services for sale |
| productivity | efficient use of resources, measure of the amount of output produced by a gen level of input in a specific period of time |
| specialization | when people, buisnesses, regions, or even countries concentrate on goods and services that they can produce better than anyone else |
| division of labor | breaking down a job into small tasks performed by different workers |
| economic interdependence | we rely on others, and other rely on to provide goods and services |
| capitalism | economic system in which private citizens own and use the factors or production in order to seek a profit |
| free enterprise | competition is allowed to flourish with a minimum of government interference |
| consumer sovereignty | the consumer is the king of the market, the one who determines what products will be produced |
| private property rights | we have the freedom to own ann use or dispose of our own property as we choose as long as we do not interfere with the rights of others |
| competition | the struggle between buyers and sellers to get the best products at the lowest prices |
| profit | the amount of money left over after all the costs of production have been paid |
| profit motive | driving force that encourages individuals and organizations to imprive their material well-being |
| voluntary exchange | act of buyers and sellers freely and willingly engaging in market transactions where both people benefit |
| Iaissez-faire economics | government should not interfere in the marketplaces, the governments role is confined to those actions necessary to ensure free competition |
| demand | refers to the desire, willingness and ability to buy a good or service |
| demand schedule | table that lists the various quantities of a product or service that someone is willing to buy over a range of prices |
| demand curve | graph that shows the amount of a product that would be bought at all possible prices in the market |
| law of demand | quantity demanded and price move in opposite directions |
| market demand | total demand of all consumers for their product or service |
| utility | pleasure, usefulness, or satisfaction we get from using the product |
| marginal utility | additional satisfaction from each additional |
| substitute | consumers can use one in place of other, competing products are called this |
| complements | they are used together, the demand for one moves in the opposite direction as the price of the other |
| demand elasticity | extent to which a change in price causes a change in the quantity demanded |
| supply | refers to the various quantities of a good or service 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 |
| supply schedule | numerical chart that illustrates the law of supply |
| supply curve | graph that shows the amount of a product that would be supplied at all possible prices in the market |
| profit | money a buisness recieves for its products or services over and above its costs |
| market supply | total of all consumers demand |
| productivity | the state or quality of producing something |
| technology | refers to the methods or processes used to make goods and services |
| subsidy | government payment to an individual, buisness or other group for certain actions |
| supply elasticity | measure of how the quantity supplied of a good or service changes in response to changes in price |
| surplus | amount by which the quantity supplied is higher than the quantity demanded |
| shortage | the amount by which the quantity demanded is higher than the quantity supplied |
| equilibrium price | the point where they achieve balance |
| price ceiling | maximum price set by the government that can be charged for goods and services |
| price floor | governments minimum price that can be charged for goods and services |
| minimum wage | the lowest legal wage that can be paid to most workers |
| private goods | goods that when consumed by one individual cannot be consumed by another |
| public goods | goods that can be consumed by one person without preventing the consumption of the good by another |
| externality | unintended side effect of an action that affects someone not involved in the action |
| monopoly | a sole provider of a good or service |
| anttitrust laws | laws to control monopoly power and to preserve and promote competition |
| merger | a combination of 2 or more companies to form a single buisness |
| natural monopoly | a market situation in which the costs of production are minimized by having a single firm produce the product |
| recall | company pulls a product off the market or agrees to change it to make it safe |
| real GDP | shows an economys production after the distortions of price increases have been removed |
| buisness cycle | the economy does not grow at a constant rate instead it goes through alternating intervals of growth and decline |
| civilian labor force | all civilians 16 years or older who are either working or looking for work |
| unemployment rate | percentage of people in the civilian labor force who are not working but are looking for jobs |
| fiscal policy | changes in government spending or taxiation |
| inflation | sustained increase in the general level of prices, hurts the economy |
| consumer price index CPI | government samples prices every month for about 400 products commonly used by consumers, the price of these 400 items make up this |
| food stamps | alleviate hunger and malnutrition by allowing low income households to obtain a more healthful diet |
| woman, infants, and children WIC | provides help with nutrition and health care to low income women, infants, and children (up 2 age 5) |
| workfare | describe programs that requrie welfare recipients to exchange some of their labor in exchange for benefits |
| progressive income tax | tax rate is lower at lower incomes and higher for higher incomes |
| earned income tax credit EITC | gives tax credits and even cash payments to qualified workers |
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