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Sheets - review cards
Terms in this set (73)
Limited quantity of resources to meet unlimited wants.
Situation in which supply of a good or service is lower than demand (excess demand).
Situation in which supply of a good or service is higher than demand (excess supply).
The most desirable alternative given up as a result of decision.
Factors of Production
Land, labor, capital/technology, and management/entrepreneurship used in the production of goods and services(?).
Natural resources used to make goods and services.
The effort that people devote to a task that they are paid.
Any human made resources that used to create other goods or services.
The process used to produce a good or service.
Ambitious leader of combines, land, labor, and capital to create and market new goods or services.
Making decisions based on the impact of the next dollar (unit) spent or the change one more unit would bring about. (Thinking at the Margin)
An alternative sacrifice when we make a decision.
Guns or Butter
A phrase that refers to the trade-offs which nations face when choosing whether to produce more or less military or consumer goods.
Things people need to survive i.e.: food, shelter, clothing, etc.
Things you desire that are not required for survival i.e.: ipod, cell phone, car, luxury items, etc.
Entities that use factors of production to create a good or service.
Individuals that utilize goods or services.
Entities that do not use their income on consumption.
Entities that use their income on consumption.
The final se of goods and services to provide utility.
Any place where people exchange goods and services.
Production and consumption of goods and services are based on voluntary exchange in markets.
Central government is in absolute control of the economy.
Rituals, habits, and customs determine how goods and services are exchanged. i.e. Agriculture based
Market-based economic system with limited government involvement. i.e. health standards
The right of an individual to own property and keep the income earned from it.
Force that encourages people and organizations to improve their material well-being.
The power of consumers to decide what gets produced.
Rivalry between two or more businesses striving for the same customers or market.
Role of Government
The level of government participation in the economic system in question.
The means by which people choose the options that give them the greatest amount of satisfaction.
Adam Smith's belief used to describe the self-regulating nature of the marketplace.
A table that lists the quantity of a good a person will buy at each different price.
Market Demand Schedule
A table that lists the quantity of a good all consumers in a market will buy at each different price.
A graphic representation of a demand schedule.
A chart that lists how much of a good a supplier will offer at different prices.
Market Supply Schedule
A chart that lists how much of good all suppliers will offer at different prices.
A graph of the quantity supplied of a good at different prices.
Market Supply Curve
A graph of the quantity supplied of a good by all suppliers at different prices.
The concept that the more of an item you possess, the less valuable each additional item becomes
Items used in conjunction with other goods.
These items function as replacements for the original good
A small change in price results in a large change in quantity demanded or supplied.
A large change in price results in a relatively small change in quantity demanded or supplied (insulin).
The price suppliers and buyers agree upon to exchange goods. Negates shortages and surpluses.
When amount of supply equals the amount in demand.
Factors that cause a shift in the supply or demand curves.
When the economy shifts into a recession or depression and the unemployment rate rises to extremely high levels. Consumer demand for products has diminished and the government expands the economy to try and create demand.
Workers' skills do not match available jobs (skills employers are seeking) due to changes in consumer demand and technological advances. Workers can receive job training and education to attain new skills.
People who are between jobs and receive information on available jobs by the government.
Certain types of jobs are available at certain times of the year due to changes in the weather and decreased demand. It is predictable because it occurs every year.
A recession that is especially long and severe.
Total value of goods and services (output) produced in the United States during a specific period to determine economic growth.
When the unemployment rate is 4-6%.
A prolonged economic contraction lasting more than two consecutive quarters.
The percentage of the work force that is jobless, while presently looking for work.
Contractional Fiscal Policy
Fiscal policies that aim to reduce economic growth through raising taxes and reducing government spending.
Expansionary Fiscal Policy
Fiscal policies that aim to stimulate economic growth through reducing taxes and expanding government spending.
The federal government's decisions about the amount of money it spends and collects in taxes to achieve a full employment and a low inflation rate.
When expenditures exceed revenues in any given year.
When revenues exceed expenditures in any given year.
Raise tax rates as income increases.
Effectively raises tax rates as income declines (example: sales tax).
Proportional Flat Tax
Same tax rates, regardless of income.
The interest rate the Federal Reserve charges member banks for loans. This influences the interest rate banks charge customers.
Federal Reserve System
The central bank of the United States, created by Congress and made up of a seven-member Board of Governors, 12 regional Federal Reserve Banks, and member banks.
Debt securities issued by the U.S. Treasury to borrow money on behalf of the federal government.
The money a borrower pays (a lender charges) for the use of money over a period of time.
Rates of interest paid on deposits and other investments, determined by the interaction of the supply of and demand for funds in the money market.
How much the money supply will increase after an initial cash deposit to the banking system.
Action taken by the Federal Reserve to control the money supply.
Open Market Operations
Actions of the Federal Reserve to control the money supply by buying and selling government bonds/securities.
Percentage of deposits that depository institutions must keep on reserve in their cash vaults or on deposits at a Federal Reserve Bank.
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