30 terms

Economic System

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authoritarian
requiring strict obedience to an authority, such as dictator
centrally planned economy
economic system in which the central government makes all decisions on the production and consumption of goods and services
collective
large farm leased from the state to groups of peasant farmers
command economy
economic system in which decisions on production and consumption of goods ans services are based on voluntary exchange in markets
communism
a political system characterized by a centrally planned economy with all economic and political power resting in the hands of the central government
competition
the struggle among the producers for the dollars of consumers
consumer sovereignty
the power of consumers to decide what get produced
continuum
a range with no clear division
economic system
the method used by a society to produce and distribute goods and services
factor market
market in which firms purchase the factor of production from households
factor payments
the income people receive for supplying factor of production, such as land, labor, or capital
free enterprise
an economic system characterized by private or corporate ownership of capital goods; investments that are determined by private decision rather than by statement control; and determined in free market
firm
an organization that uses resources produce the factor of production from household
heavy industry
industry that requires a large capital investment and that produces items used in other industries
laissez faire
the doctrine stated that government generally should not interfere in the market place
market
an arrangement that allows buyers and sellers to exchange things
market economy
economic system in which the central government makes all decisions on the production and consumption of goods and services
mixed economy
market-based economic system with limited government involvement
patriotism
the love of one's country; the passion that inspires a person to serve his or her country
private property
property owned by individuals or companies, not by the government or the people as a whole
privatize
to sell state-run firms to individuals
product market
the market in which households purchase the goods and services that firms produce
profit
the financial gain made in transaction
safety net
government programs that protect people experiencing unfavorable economic conditions
self-interest
one's one personal gain
socialism
a social and political philosophy based on the belief that democratic means should be used to evenly distribute wealth throughout a society
specialization
the concentration of the productive efforts of individuals and firms on a limited number of activities
standard of living
level of economic prosperity
traditional economy
economic system that relies on habit, custom, or ritual to decide questions of production and consumption of goods and services
transition
period of change in which an economy moves away from a centrally planned economy toward a market-based system
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