Economics Final Study Guide - Buhl
Terms in this set (71)
Limited quantities of resources to meet unlimited wants
Cost of the next best alternative use of money, time, or resources when one choice is made rather than another
production possibilities curve
circular flow of economic activity
Desire to make money that motivates people to produce and sell good and services
Type of loan repaid with equal payments or installments over a specific period of time.
Any decrease or loss in value caused by age, wear, or market conditions.
IRA vs. Roth IRA
The amount of a good or service that producers are willing and able to sell at a certain price.
the act of buyers and sellers freely and willingly engaging in market transactions.
law of demand
consumers buy more of a good when its price decreases and less when its price increases
when consumers react to an increase in a good's price by consuming less of that good and more of a substitute good.
horizontal vs. vertical merger
combination of two or more firms producing the same kind of product
two or more firms involved in different stages of producing the same good or service
The ability of any good or service to satisfy consumer wants.
A general increase in prices and fall in the purchasing value of money.
consumer price index
Use various types of data to measure economic development (GNI, GDP, Vehicle Ownership, Smartphone Ownership, Internet connectedness, Ect)
Government policy that attempts to manage the economy by controlling the money supply and thus interest rates.
fractional reserve banking
federal funds rate
public assistance programs
Distributes public money to poor people: food stamps, medicaid, (Aid to Families with Dependent Children), Supplemental Security Income, and Job Opportunities & Basic Skills programs
Theory based on the principles of John Maynard Keynes, stating that government spending should increase during business slumps and be curbed during booms.
goods produced abroad and sold domestically
the ability of an individual or group to carry out a particular economic activity more efficiently than another individual or group. (Brazil is better at producing bananas then the Russians.)
flexible exchange rates
Changing something from private to state ownership or control.
A program of giving military and economic help to other countries.
1. What are the major types of economic systems and their differences?
2. List and explain the four factors of production.
3. How do stocks and bonds differ?
4. Give three examples of how government protects consumers.
5. What four factors determine a person's credit rating?
1. Capacity to pay. 2. Character - checks whether a person is responsible and trustworthy 3. Collateral - something of value that the borrower lets the lender claim if a loan is not repaid
6. What are the responsibilities of a borrower?
7. If you do not pay cash for a car, what expenses must be included in the cost of buying a car? After you buy the car, what on-going costs must you consider?
8. List and explain four determinants of supply and four determinants of demand.
9. What is a corporation? What does a business have to do to become a corporation? What is the benefit?
10. Describe an instance in your own life when diminishing marginal utility caused you to decrease your quantity demand of a product or service.
11. What are the five conditions of perfect competition? How does it benefit society? How in some instances might it hurt society?
12. List four categories of worker based on skill. Explain them.
13. What four categories of economic activity are used to measure GDP?1
GDP= C + I + G - X
C - consumer sector, goods and services people buy.
I - investment sector, business purchases used to produce other goods.
G - goods and services bought by the government
X - net exports, the difference between exports and imports.
14. Draw and label the stages of the business cycle.
15. What are the six major characteristics of money? Explain them.
16. What are the functions of the Fed?
1 Clearing checks - over sees the process of depositing checks and getting money to the recipient. 2 Regulating the money supply. Supplying paper money, holding and setting reserve requirements - how much needs to be in it. 4 supervising member banks.
17. What are the differences between loose money and tight money policies?
18. What are the four kinds of unemployment?
1, Frictional - temporarily unemployment between jobs. 2, seasonal, due to changes in seasons in wether. 3, Structural, changes in the economy, ex robots take over jobs. 4, Cyclical, unemployment due to fluctuations in the business cycle.
19. What are three arguments for and against free trade? Please explain those arguments? What are some current international and regional trade agreements?
20. What are five economic characteristics of developing nations?
Please ask your teacher to print out the graphing and calculation section for practice.
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