Flashcards › Core Concepts 5

What is economics? the study of how people meet their wants and needs Having a limited quantity of resources to meet unlimited wants is called scarcity The cost of what you have to give up is called? opportunity cost What is demand? the desire for a certain good or service What is supply? an amount of a good or service that is available for use Who are people or businesses that make and sell goods producers people or businesses that buy or consume products consumers What is an incentive? a factor that encourages people to act in a certain way What is the difference between profit and revenue? revenue is money a producer gets from selling a good or service; profit is the money left over after paying bills What is a market? an organized way for consumers and producers to exchange goods and services What is specialization? the act of concentrating on a limited number or goods or services What is the struggle among producers for consumers money called? competition A general increase in prices is called? inflation What is a recession? a decline in economic growth for six or more months Name the 4 types of economies traditional,market,command,mixed Which type of economy is based on customs or habits traditional Which economy is known as capitalism? market Who makes most of the decisions in a command economy? the government What is gross domestic product? total value of all goods and services produced in a country in a year What is development? economic growth or an increase in living standards What is the difference between a developed country and a developing country? developed country - stong economy and high standard of living developing country - less productive economies and lower standard of living What is productivity? amount of goods and services produced given the amoutn of resources used What is the practical application of knowledge to accomplish a task called? technology What is trade? exchange of goods and services in a market What is the difference between imports and exports? imports are goods and services made in a country and sold in another country; exports goods and services made in one country and sold in another what is a tariff? tax on imports or exports What is a policy that limits international trade is called? trade barrier What is the removal of trade barriers called? free trade What is a budget? a plan that shows income and expenses over a period of time What is tha act of setting aside money for future use called? saving Price paid for borrowing money is called? interest What is credit? an arrangement in which a butyer can borrow to purchase something and buy it back over time What is the act of using money in the hope of making a future profit called? investing What is the difference between a stock and bond? stock- share of ownership in a country: bond certificate issued by a company or government promising to pay back money with interest Words and definitions about economics