Basic Economics
absolute advantage
the ability of an individual, a firm, or a country to produce more of a good or service than competitors, using the same amount of resources
Adam Smith's "invisible hand" refers to
the process by which individuals acting in their own self-interest bring about a market outcome that benefits society as a whole
Assets
stocks, bonds, property
Bartering
trading one item for another
buying power
Resources, such as money, goods, and services, that can be traded in an exchange
Collusion
can create price fixing with more than one company
comparative advantage
the ability of an individual, a firm, or a country to produce a good or service at a lower opportunity cost than competitors
consumable goods
An item that is consumed in minutes to 3 years
consumer sovereignty
the situation in an economy where the desires and needs of consumers control the output of producers.
cooperative
A business that is owned by the members it serves and is managed in their interest.
Corporation
A business that is owned by many investors
Deficit spending
hurt in the future because of increase in taxes and less money for the economy
Demand
when high, the price increases
durable goods
manufactured items that have a life span longer than three years
ECB
European Central Bank
embargo
prohibit trade
Exports
expanding business outside a country
Federal Reserve
controls money supply through monetary policies
Fiscal policies
determined by Congress
Franchise
A business established or operated under an authorization to sell or distribute a company's goods or services in a particular area
G20
countries coming together to talk about economics and other world issues
GDP (Gross Domestic Product)
determines how countries are doing by comparing output of goods and services
import quota
limitation of number of imports
Imports
helps supply needed materials
incentives
an action or reward that motivates one to act a certain way
Inflation
money is worth less
Investments
using assets to make more money
Labor unions
work for employee rights
marginal benefits
Additional benefits received when one more unit of a product is produced. The maximum amount a consumer is willing to pay for an additional unit of a good or service
marginal cost
Extra cost of producing one additional unit of production.
member bank
a bank that is a member of the Federal Reserve System and must be covered under FDIC
Migrant workers
never have guarantee work, move from place to place
Monopolies
hurts competition by one company controlling
Needs
food and shelter
Offshore outsourcing
takes away from a country job opportunities by sending jobs overseas
Outsourcing
helps a company save money by sending business out
Partnership
A business in which two or more persons combine their assets and skills
price ceiling
maximum legal price that can be charged for a product
price floor
A legal minimum on the price at which a good can be sold
Profits
sales minus costs
purchasing power
the real goods and services that money can buy; determines the value of money
Recession
slow economy
Sole Proprietorship
a business owned and managed by a single individual
Subsidies
tax breaks, payments, incentives paid by the government to help companies
Supply
when low, the prices increase
tariff
tax on imports
Taxes
money collected to provide services
Trade deficit
spending more on foreign trade because of more imports
Trade surplus
good for a countries economy, more money coming into the country because of more exports
Treasury
collects money, pay bills, print money
Unemployment
less jobs in a recession
UN (United Nations)
world peace keeping force
Wants
new car
the ability of an individual, a firm, or a country to produce more of a good or service than competitors, using the same amount of resources
Adam Smith's "invisible hand" refers to
the process by which individuals acting in their own self-interest bring about a market outcome that benefits society as a whole
Assets
stocks, bonds, property
Bartering
trading one item for another
buying power
Resources, such as money, goods, and services, that can be traded in an exchange
Collusion
can create price fixing with more than one company
comparative advantage
the ability of an individual, a firm, or a country to produce a good or service at a lower opportunity cost than competitors
consumable goods
An item that is consumed in minutes to 3 years
consumer sovereignty
the situation in an economy where the desires and needs of consumers control the output of producers.
cooperative
A business that is owned by the members it serves and is managed in their interest.
Corporation
A business that is owned by many investors
Deficit spending
hurt in the future because of increase in taxes and less money for the economy
Demand
when high, the price increases
durable goods
manufactured items that have a life span longer than three years
ECB
European Central Bank
embargo
prohibit trade
Exports
expanding business outside a country
Federal Reserve
controls money supply through monetary policies
Fiscal policies
determined by Congress
Franchise
A business established or operated under an authorization to sell or distribute a company's goods or services in a particular area
G20
countries coming together to talk about economics and other world issues
GDP (Gross Domestic Product)
determines how countries are doing by comparing output of goods and services
import quota
limitation of number of imports
Imports
helps supply needed materials
incentives
an action or reward that motivates one to act a certain way
Inflation
money is worth less
Investments
using assets to make more money
Labor unions
work for employee rights
marginal benefits
Additional benefits received when one more unit of a product is produced. The maximum amount a consumer is willing to pay for an additional unit of a good or service
marginal cost
Extra cost of producing one additional unit of production.
member bank
a bank that is a member of the Federal Reserve System and must be covered under FDIC
Migrant workers
never have guarantee work, move from place to place
Monopolies
hurts competition by one company controlling
Needs
food and shelter
Offshore outsourcing
takes away from a country job opportunities by sending jobs overseas
Outsourcing
helps a company save money by sending business out
Partnership
A business in which two or more persons combine their assets and skills
price ceiling
maximum legal price that can be charged for a product
price floor
A legal minimum on the price at which a good can be sold
Profits
sales minus costs
purchasing power
the real goods and services that money can buy; determines the value of money
Recession
slow economy
Sole Proprietorship
a business owned and managed by a single individual
Subsidies
tax breaks, payments, incentives paid by the government to help companies
Supply
when low, the prices increase
tariff
tax on imports
Taxes
money collected to provide services
Trade deficit
spending more on foreign trade because of more imports
Trade surplus
good for a countries economy, more money coming into the country because of more exports
Treasury
collects money, pay bills, print money
Unemployment
less jobs in a recession
UN (United Nations)
world peace keeping force
Wants
new car
Global Economics
Balance of payments
the difference between total imports and total exports of goods and service
Capital
money used to generate income or to invest in a business or asset
Cartel
a group of countries or firms that control the production and pricing of a product or service
Command Economy
a system in which a central authority, usually the government, controls economic activities
Consumer
buyer and user of goods and services
Demand
the quantity of a product or service consumers are willing to buy
ECB
European Central Bank...like our Feds
Economic globalization
the flow of goods, services, labor, money, innovative ideas , and technology across borders
Economic System
the structure in which resources are turned into goods and services to address unlimited needs and wants
Economy of scale
the cost of producing one unit of something declines as the number of units produced rises
European Union (EU)
the largest trade sector in the world surpassing any individual country, made up of countries from Europe
Exchange rate
the value of one currency compared to another
Exports
the goods and services grown or made in
a particular country and then sold in world markets
Free Enterprise System
capitalism
Free trade
a policy of limited government trade restrictions
Goods
physical items such as food and clothing
Human Resources
qualities and characteristics that people have within themselves
Imports
the goods and services that come into a country from other countries
Innovation
the engine that sparks growth and prosperity
International trade
the buying and selling of goods and services across national borders
inversion
Re-incorporating a company overseas in order to reduce the tax burden on income earned
Market economy
a system in which privately owned businesses operate and compete for profits with limited government regulations
Marketplace
not a physical place like a mall or a grocery store but an arena in which consumers and producers meet to exchange goods, services, and money
Migrants
people who move from one place or country to another
Mixed Economy
a combination of the market and the command systems
Multinational corporation
a business that operates in more than one country
Needs
items a person must have to survive
Nonhuman Resources
external resources, such as money, time, equipment, and possessions
Offshore outsourcing
moving sections of a business to another country
OPEC
Organization of Petroleum Exporting Countries
Opportunity Cost
the value of the best option or alternative given up
Outsourcing
when companies move sections of their business to other companies to reduce cost
Producer
an individual or business that provides the supply of goods and services to meet consumer demands
Profit
the total amount of money earned after expenses are subtracted from income
Resources
refers to any input used to generate other goods or services
Scarcity
the challenge of stretching resources to cover needs and wants
Services
work performed
Specialization
a trade of goods or services that other countries can not produce
Supply
the amount of a product or service producers are willing to provide
Technology
the application of scientific knowledge to uses and products development
Trade barrier
any actions taken to control or limit imports
Trade deficit
when a country buys, or imports, more products than it sells
Trade-off
an item given up in order to gain something else
Trade surplus
when a country sells, or exports more than it buys
Traditional economy
a system in which economic decisions are based on society's values, culture, and customs.
Wants
items a person would like to have
World Trade Organization (WTO)
an international organization that mediates trade disputes among 151 member nations and establishes trade practices that are acceptable and fair to all nations
Learn M
the difference between total imports and total exports of goods and service
Capital
money used to generate income or to invest in a business or asset
Cartel
a group of countries or firms that control the production and pricing of a product or service
Command Economy
a system in which a central authority, usually the government, controls economic activities
Consumer
buyer and user of goods and services
Demand
the quantity of a product or service consumers are willing to buy
ECB
European Central Bank...like our Feds
Economic globalization
the flow of goods, services, labor, money, innovative ideas , and technology across borders
Economic System
the structure in which resources are turned into goods and services to address unlimited needs and wants
Economy of scale
the cost of producing one unit of something declines as the number of units produced rises
European Union (EU)
the largest trade sector in the world surpassing any individual country, made up of countries from Europe
Exchange rate
the value of one currency compared to another
Exports
the goods and services grown or made in
a particular country and then sold in world markets
Free Enterprise System
capitalism
Free trade
a policy of limited government trade restrictions
Goods
physical items such as food and clothing
Human Resources
qualities and characteristics that people have within themselves
Imports
the goods and services that come into a country from other countries
Innovation
the engine that sparks growth and prosperity
International trade
the buying and selling of goods and services across national borders
inversion
Re-incorporating a company overseas in order to reduce the tax burden on income earned
Market economy
a system in which privately owned businesses operate and compete for profits with limited government regulations
Marketplace
not a physical place like a mall or a grocery store but an arena in which consumers and producers meet to exchange goods, services, and money
Migrants
people who move from one place or country to another
Mixed Economy
a combination of the market and the command systems
Multinational corporation
a business that operates in more than one country
Needs
items a person must have to survive
Nonhuman Resources
external resources, such as money, time, equipment, and possessions
Offshore outsourcing
moving sections of a business to another country
OPEC
Organization of Petroleum Exporting Countries
Opportunity Cost
the value of the best option or alternative given up
Outsourcing
when companies move sections of their business to other companies to reduce cost
Producer
an individual or business that provides the supply of goods and services to meet consumer demands
Profit
the total amount of money earned after expenses are subtracted from income
Resources
refers to any input used to generate other goods or services
Scarcity
the challenge of stretching resources to cover needs and wants
Services
work performed
Specialization
a trade of goods or services that other countries can not produce
Supply
the amount of a product or service producers are willing to provide
Technology
the application of scientific knowledge to uses and products development
Trade barrier
any actions taken to control or limit imports
Trade deficit
when a country buys, or imports, more products than it sells
Trade-off
an item given up in order to gain something else
Trade surplus
when a country sells, or exports more than it buys
Traditional economy
a system in which economic decisions are based on society's values, culture, and customs.
Wants
items a person would like to have
World Trade Organization (WTO)
an international organization that mediates trade disputes among 151 member nations and establishes trade practices that are acceptable and fair to all nations
Learn M
Business Economics
Action Phase
Getting a plan going...determination and flexibility
Asset
an item of value you own, such as cash, stocks, bonds, real estate, and personal possessions
Business cycle
fluctuation between periods of economic growth & slowdown
Collusion
the companies in an oligopoly are not allowed to make secret agreement among themselves
Command Economy
a system in which a central authority, usually the government, controls economic activities
Consumer
buyer and user of goods and services
Consumer price index (CPI)
it is a measure of the average change in prices over time for selected goods and services
contraction
the period in the business cycle where there is decreasing or no growth
Cost-Benefit Principle
Weighing the amount paid compared to the advantages
Deficit spending
the amount the federal government spends each year beyond the amount it receives in revenue
Demand
the quantity of a product or service consumers are willing to buy
Depression
when a recession goes on for several years
Durable goods
furniture, appliances, and cars
Economic System
the structure in which resources are turned into goods and services to address unlimited needs and wants
Ethics
Moral principles or beliefs that directs a person's action
Evaluation Stage
Ongoing reflection on how well things went
Federal Reserve (Feds)
controls the flow of money through monetary policies: interest rates, reserves, equities
Fiscal Policy
the federal government's taxing and spending decisions
Free Enterprise System
capitalism
Goals
An objective you want to obtain
Goods
physical items such as food and clothing
Gross domestic product (GDP)
measures the value of all goods and services produced by a nation during a specified period
Human Resources
qualities and characteristics that people have within themselves
Income tax
a tax on the earnings of individuals and corporations
Inflation
an overall increase in the price of goods and services
Innovation
the engine that sparks growth and prosperity
Inversion
relocation of a corporation's headquarters to a lower-tax nation through mergers and acquisitions
Investment
is an asset you buy that increases your wealth over time, but carries the risk of loss
Jobless claims
asking for governmental help because a person can't find a job
Labor Force
composed of people, age 16 and over, who are employed or looking for and able to work
Labor productivity
the value of the goods and services a worker creates in a given time
Labor Union
a group of workers who are covered by collective bargaining agreements
Market economy
a system in which privately owned businesses operate and compete for profits with limited government regulations
Marketplace
not a physical place like a mall or a grocery store but an arena in which consumers and producers meet to exchange goods, services, and money
Mixed Economy
a combination of the market and the command systems
Monetary Policy
actions the federal reserve board takes to change the supply of money and credit
Monopoly
a single seller or producer of a given product or service
National Debt
the total amount of money the government owes at a given time
Needs
items a person must have to survive
Nonhuman Resources
external resources, such as money, time, equipment, and possessions
Oligopoly
occurs when a few large companies dominate an industry
Opportunity Cost
the value of the best option or alternative given up
peak
the period in the business cycle where the economy has reached the highest limit and begins a downturn
Perfect competition
competition between producers results in greater innovation, better service, and lower prices for consumers
Planning Phase
Beginning a plan of action, first stage...organization
PPI
Producer Price Index, shows how much more/less a manufactorer is charging for their product
Priority
A goal or value that is given more importance than others
Producer
an individual or business that provides the supply of goods and services to meet consumer demands
Profit
the total amount of money earned after expenses are subtracted from income
Property tax
a tax that is paid on real estate owned by individuals and corporations
proprietorship
owning a business
prosperity
the period in the business cycle where there is a "boom" or upswing in the economy
Recession
an extended period of slow or no economic growth
Resources
refers to any input used to generate other goods or services
Sales tax
tax added to the price of goods and services you buy
Scarcity
the challenge of stretching resources to cover needs and wants
Services
work performed
Stagflation
a period of slow or no economic growth and high inflation
Standard of living
the overall level of comfort of a person, household, or population as measured by the amount of goods and services consumed
Supply
the amount of a product or service producers are willing to provide
Tax
a fee imposed by government on income, products, or activities, and paid by citizens and businesses
Technology
the application of scientific knowledge to uses and products development
Trade-off
an item given up in order to gain something else
Traditional economy
a system in which economic decisions are based on society's values, culture, and customs.
trough
the period in the business cycle where the decline in growth has stopped or reached the bottom
Underemployment
workers who are employed only part time or who are "over qualified" for their jobs
Unemployment rate
the percentage of the labor forces that is out of work who are "over qualified" for their jobs
Values
A person's beliefs
Wants
items a person would like to have
Getting a plan going...determination and flexibility
Asset
an item of value you own, such as cash, stocks, bonds, real estate, and personal possessions
Business cycle
fluctuation between periods of economic growth & slowdown
Collusion
the companies in an oligopoly are not allowed to make secret agreement among themselves
Command Economy
a system in which a central authority, usually the government, controls economic activities
Consumer
buyer and user of goods and services
Consumer price index (CPI)
it is a measure of the average change in prices over time for selected goods and services
contraction
the period in the business cycle where there is decreasing or no growth
Cost-Benefit Principle
Weighing the amount paid compared to the advantages
Deficit spending
the amount the federal government spends each year beyond the amount it receives in revenue
Demand
the quantity of a product or service consumers are willing to buy
Depression
when a recession goes on for several years
Durable goods
furniture, appliances, and cars
Economic System
the structure in which resources are turned into goods and services to address unlimited needs and wants
Ethics
Moral principles or beliefs that directs a person's action
Evaluation Stage
Ongoing reflection on how well things went
Federal Reserve (Feds)
controls the flow of money through monetary policies: interest rates, reserves, equities
Fiscal Policy
the federal government's taxing and spending decisions
Free Enterprise System
capitalism
Goals
An objective you want to obtain
Goods
physical items such as food and clothing
Gross domestic product (GDP)
measures the value of all goods and services produced by a nation during a specified period
Human Resources
qualities and characteristics that people have within themselves
Income tax
a tax on the earnings of individuals and corporations
Inflation
an overall increase in the price of goods and services
Innovation
the engine that sparks growth and prosperity
Inversion
relocation of a corporation's headquarters to a lower-tax nation through mergers and acquisitions
Investment
is an asset you buy that increases your wealth over time, but carries the risk of loss
Jobless claims
asking for governmental help because a person can't find a job
Labor Force
composed of people, age 16 and over, who are employed or looking for and able to work
Labor productivity
the value of the goods and services a worker creates in a given time
Labor Union
a group of workers who are covered by collective bargaining agreements
Market economy
a system in which privately owned businesses operate and compete for profits with limited government regulations
Marketplace
not a physical place like a mall or a grocery store but an arena in which consumers and producers meet to exchange goods, services, and money
Mixed Economy
a combination of the market and the command systems
Monetary Policy
actions the federal reserve board takes to change the supply of money and credit
Monopoly
a single seller or producer of a given product or service
National Debt
the total amount of money the government owes at a given time
Needs
items a person must have to survive
Nonhuman Resources
external resources, such as money, time, equipment, and possessions
Oligopoly
occurs when a few large companies dominate an industry
Opportunity Cost
the value of the best option or alternative given up
peak
the period in the business cycle where the economy has reached the highest limit and begins a downturn
Perfect competition
competition between producers results in greater innovation, better service, and lower prices for consumers
Planning Phase
Beginning a plan of action, first stage...organization
PPI
Producer Price Index, shows how much more/less a manufactorer is charging for their product
Priority
A goal or value that is given more importance than others
Producer
an individual or business that provides the supply of goods and services to meet consumer demands
Profit
the total amount of money earned after expenses are subtracted from income
Property tax
a tax that is paid on real estate owned by individuals and corporations
proprietorship
owning a business
prosperity
the period in the business cycle where there is a "boom" or upswing in the economy
Recession
an extended period of slow or no economic growth
Resources
refers to any input used to generate other goods or services
Sales tax
tax added to the price of goods and services you buy
Scarcity
the challenge of stretching resources to cover needs and wants
Services
work performed
Stagflation
a period of slow or no economic growth and high inflation
Standard of living
the overall level of comfort of a person, household, or population as measured by the amount of goods and services consumed
Supply
the amount of a product or service producers are willing to provide
Tax
a fee imposed by government on income, products, or activities, and paid by citizens and businesses
Technology
the application of scientific knowledge to uses and products development
Trade-off
an item given up in order to gain something else
Traditional economy
a system in which economic decisions are based on society's values, culture, and customs.
trough
the period in the business cycle where the decline in growth has stopped or reached the bottom
Underemployment
workers who are employed only part time or who are "over qualified" for their jobs
Unemployment rate
the percentage of the labor forces that is out of work who are "over qualified" for their jobs
Values
A person's beliefs
Wants
items a person would like to have
Governmental Economics
Anti-Trust Laws
promotes competition and fair trade, and prevents companies from dominating an industry
Assets
stocks, bonds, saving accounts, cars, appliances, computers, things you own
business cycle
Fluctuations in economic activity, such as employment and production
Conflict of Interest
sellers want higher prices, consumer wants lower prices...seller wants to maintain lower wages, workers want to have higher wages...also can mean a person's business conflicts with his duty
contraction
Slow or no economic growth in the business cycle
Discount Rate
interest rate the Federal Reserve charges banks to borrow government money
discretionary expense
not necessary for maintaining normal governmental operations
diverse portfolio
many different investments opportunities
Dividends
money paid to a stock holder for owning the company stock
Durable goods
cars, appliances, computers
embargo
no trading between countries
expansion
Growth in the business cycle
Federal Reserve System (Feds)
Regulates the nation's money supply and banking system
Federal Trade Commission
Promotes free and fair trade competition by preventing deceptive practices, false advertising, and unfair trade practices
Fiscal Policy
The governments taxing and spending decisions. To stimulate the economy, the government spends more and lowers taxes
Innovation
Produces new ideas that can increase profits and make a better product
Liquid Assets
Things that can be turned into cash quickly...cash, savings accounts, money market accounts, checking accounts
member banks
banks that belongs to the Federal Reserve System and are required to carry FDIC.
Monetary Policy
the action the Feds take to change the money supply
Monopoly
Complete control of a product or business by one person or group
National Debt
What the government owes
Open Market Operations
The Feds buying and selling Treasury securities in the market place
peak
Height of expansion in the business cycle
Profit
Income minus expenses...The driving force behind our economy
quotas
limiting the amount of goods sold by other countries
Reserve Requirements
the amount of cash that banks and other financial institutions must set aside rather than lend to customers
Securities
stocks, bonds, and other investment opportunities
Securities and Exchange Commission (SEC)
Protects against fraud and enforces fair and full disclosure of financial data about securities
tariff
taxing foreign goods to make them price competitive
trough
When contraction stops in the business cycle
Unemployment
Less people paying taxes, higher cost for the government, unrest
U.S. Department of Treasury
manages the finances of the federal government by collecting taxes and paying the bills
promotes competition and fair trade, and prevents companies from dominating an industry
Assets
stocks, bonds, saving accounts, cars, appliances, computers, things you own
business cycle
Fluctuations in economic activity, such as employment and production
Conflict of Interest
sellers want higher prices, consumer wants lower prices...seller wants to maintain lower wages, workers want to have higher wages...also can mean a person's business conflicts with his duty
contraction
Slow or no economic growth in the business cycle
Discount Rate
interest rate the Federal Reserve charges banks to borrow government money
discretionary expense
not necessary for maintaining normal governmental operations
diverse portfolio
many different investments opportunities
Dividends
money paid to a stock holder for owning the company stock
Durable goods
cars, appliances, computers
embargo
no trading between countries
expansion
Growth in the business cycle
Federal Reserve System (Feds)
Regulates the nation's money supply and banking system
Federal Trade Commission
Promotes free and fair trade competition by preventing deceptive practices, false advertising, and unfair trade practices
Fiscal Policy
The governments taxing and spending decisions. To stimulate the economy, the government spends more and lowers taxes
Innovation
Produces new ideas that can increase profits and make a better product
Liquid Assets
Things that can be turned into cash quickly...cash, savings accounts, money market accounts, checking accounts
member banks
banks that belongs to the Federal Reserve System and are required to carry FDIC.
Monetary Policy
the action the Feds take to change the money supply
Monopoly
Complete control of a product or business by one person or group
National Debt
What the government owes
Open Market Operations
The Feds buying and selling Treasury securities in the market place
peak
Height of expansion in the business cycle
Profit
Income minus expenses...The driving force behind our economy
quotas
limiting the amount of goods sold by other countries
Reserve Requirements
the amount of cash that banks and other financial institutions must set aside rather than lend to customers
Securities
stocks, bonds, and other investment opportunities
Securities and Exchange Commission (SEC)
Protects against fraud and enforces fair and full disclosure of financial data about securities
tariff
taxing foreign goods to make them price competitive
trough
When contraction stops in the business cycle
Unemployment
Less people paying taxes, higher cost for the government, unrest
U.S. Department of Treasury
manages the finances of the federal government by collecting taxes and paying the bills
Economics Vocabulary
Action Phase
Getting a plan going...determination and flexibility
Anti-Trust Laws
promotes competition and fair trade, and prevents companies from dominating an industry
Assets
things that you own that have value such as stocks, bonds, saving accounts, cars, appliances, computers, etc
Balance of payments
the difference between total imports and total exports of goods and service
Business cycle
flucuation between periods of economic growth & slowdown
Capital
money used to generate income or to invest in a business or asset
Cartel
a group of countries or firms that control the production and pricing of a product or service
Collusion
the companies in an oligopoly are not allowed to make secret aggreement among themselves
Command Economy
a system in which a central authority, usually the government, controls economic activities
Comparative advantage
is the benefit to the party that has the lower opportunity cost in pursuing a given course of action
Conflict of Interest
sellers want higher prices, consumer wants lower prices...seller wants to maintain lower wages, workers want to have higher wages...also can mean a person's business conflicts with his duty
Consumer
buyer and user of goods and services
Consumer price index (CPI)
it is a measure of the average change in prices over time for selcted goods and services
Cost-Benefit Principle
Weighing the amount paid compared to the advances
Deficit spending
the amount the federal government spends each year beyond the amount it receives in revenue
Demand
the quantity of a product or service consumers are willing to buy
Depression
when a recession goes on for several years
Discount Rate
interest rate the Federal Reserve charges banks to borrow government money
Dividends
money (profits) paid to a stock holder for owning the company stock
Dumping
Selling goods in another country below market prices
Durable goods
cars, appliances, computers
Economic globalization
the flow of goods, services, labor, money, innovative ideas , and technology across borders
Economic System
the structure in which resources are turned into goods and services to address unlimited needs and wants
Economies of scale
the cost of producing one unit of something declines as the number of units produced rises
Ethics
Moral principles or beliefs that directs a person's action
European Union (EU)
the largest trade sector in the world surpassing any individual country
Evaluation Stage
Ongoing reflection on how well things went
Exchange rate
the value of one currency compared to another
Exports
the goods and services grown or made in
FDA
Food and Drug Administration
Federal Reserve System (Feds)
Regulates the nation's money supply and banking system
Federal Trade Commission
Promotes free and fair trade competition by preventing deceptive practices, false advertising, and unfair trade practices
Fiscal Policy
The governments taxing and spending decisions. To stimulate the economy, the government spends more and lowers taxes
Free Enterprise System
capitalism
Free trade
a policy of limited government trade restrictions
Goals
An objective you want to obtain
Goods
physical items such as food and clothing
Gross domestic product (GDP)
measures the value of all goods and services produced by a nation during a specified period
Human Resources
qualities and characteristics that people have within themselves
hyperinflation
rapid, excessive, and out of control price increases
Imports
the goods and services that come into a country from other countries
Income tax
a tax on the earnings of individuals and corporations
Inflation
an overall increase in the price of goods and services
Innovation
Produces new ideas that can increase profits and make a better product
International trade
the buying and selling of goods and services across national borders
Inversion
relocation of a corporation's headquarters to a lower-tax nation through mergers and acquisitions
Investment
is an asset you buy that increases your wealth over time, but carries the risk of loss
Jobless Caims
when unemployed workers request assistance
Labor Force
composed of people, age 16 and over, who are employed or looking for and able to work
Labor productivity
the value of the goods and services a worker creates in a given time
Labor Union
a group of workers who are covered by collective bargaining aggreements
Liquid Assets
cash, savings accounts, money market accounts, checking accounts...
Market economy
a system in which privately owned businesses operate and compete for profits with limited government regulations
Marketplace
not a physical place like a mall or a grocery store but an arena in which consumers and producers meet to exchange goods, services, and money
Migrants
people who move from one place or country to another
Mixed Economy
a combination of the market and the command systems
Monetary Policy
actions the federal reserve board takes to change the supply of money and credit
Monopoly
a single seller or producer of a given product or service
Multinational corporation
a business that operates in more than one country
National Debt
the total amount of money the government owes at a given time
Needs
items a person must have to survive
Nonhuman Resources
external resources, such as money, time, equipment, and possessions
Offshore outsourcing
moving sections of a business to another country
Oligopoly
occurs when a few large companies dominate an industry
OPEC
Organization of Petroleum Exporting Countries
Open Market Operations
The Feds buying and selling Treasury securities in the market place
Opportunity Cost
the value of the best option or alternative given up
Outsourcing
when companies move sections of their business to other companies or to their own subsidiaries
Perfect competition
competition between producers results in greater innovation, better service, and lower prices for consumers
Planning Phase
Beginning a plan of action, first stage...organization
Priority
A goal or value that is given more importance than others
Producer
an individual or business that provides the supply of goods and services to meet consumer demands
Profit
the total amount of money earned after expenses are subtracted from income
Property tax
a tax that is paid on real estate owned by individuals and corporations
Prosperity
periods of growth and financial well-being
Recession
an extended period of slow or no economic growth
Reserve Requirements
the amount of cash that banks and other financial institutions must set aside rather than lend to customers
Resources
refers to any input used to generate other goods or services
Sales tax
tax added to the price of goods and services you buy
Scarcity
the challenge of stretching resources to cover needs and wants
Securities
stocks, bonds, and other investment opportunities
Securities and Exchange Commission (SEC)
Protects against fraud and enforces fair and full disclosure of financial data about securities
Services
work performed
Specialization
a trade of goods or services that it cannot produce
Stagflation
a period of slow growth and high inflation
Standard of living
the overall level of comfort of a person, household, or population as measured by the amount of goods and services consumed
Supply
the amount of a product or service producers are willing to provide
Tax
a fee imposed by government on income, products, or activities, and paid by citizens and businessess
Technology
the application of scientific knowledge to uses and products development
Trade barrier
any actions taken to control or limit imports
Trade deficit
when a country buys, or imports, more products than it sells
Trade-off
an item given up in order to gain something else
Trade surplus
when a country sells, or exports more than it buys
Traditional economy
a system in which economic decisions are based on society's values, culture, and customs.
Underemployment
workers who are employed only part time or who are "over qualified" for their jobs
Unemployment rate
the percentage of the labor forces that is out of work who are "over qualified" for their jobs
U.S. Department of Treasury
manages the finances of the federal government by collecting taxes and paying the bills
Values
A person's beliefs
Wants
items a person would like to have
World Trade Organization (WTO)
an international organization that mediates trade disputes among 151 member nations and establishes trade practices that are acceptable and fair to all nations
Getting a plan going...determination and flexibility
Anti-Trust Laws
promotes competition and fair trade, and prevents companies from dominating an industry
Assets
things that you own that have value such as stocks, bonds, saving accounts, cars, appliances, computers, etc
Balance of payments
the difference between total imports and total exports of goods and service
Business cycle
flucuation between periods of economic growth & slowdown
Capital
money used to generate income or to invest in a business or asset
Cartel
a group of countries or firms that control the production and pricing of a product or service
Collusion
the companies in an oligopoly are not allowed to make secret aggreement among themselves
Command Economy
a system in which a central authority, usually the government, controls economic activities
Comparative advantage
is the benefit to the party that has the lower opportunity cost in pursuing a given course of action
Conflict of Interest
sellers want higher prices, consumer wants lower prices...seller wants to maintain lower wages, workers want to have higher wages...also can mean a person's business conflicts with his duty
Consumer
buyer and user of goods and services
Consumer price index (CPI)
it is a measure of the average change in prices over time for selcted goods and services
Cost-Benefit Principle
Weighing the amount paid compared to the advances
Deficit spending
the amount the federal government spends each year beyond the amount it receives in revenue
Demand
the quantity of a product or service consumers are willing to buy
Depression
when a recession goes on for several years
Discount Rate
interest rate the Federal Reserve charges banks to borrow government money
Dividends
money (profits) paid to a stock holder for owning the company stock
Dumping
Selling goods in another country below market prices
Durable goods
cars, appliances, computers
Economic globalization
the flow of goods, services, labor, money, innovative ideas , and technology across borders
Economic System
the structure in which resources are turned into goods and services to address unlimited needs and wants
Economies of scale
the cost of producing one unit of something declines as the number of units produced rises
Ethics
Moral principles or beliefs that directs a person's action
European Union (EU)
the largest trade sector in the world surpassing any individual country
Evaluation Stage
Ongoing reflection on how well things went
Exchange rate
the value of one currency compared to another
Exports
the goods and services grown or made in
FDA
Food and Drug Administration
Federal Reserve System (Feds)
Regulates the nation's money supply and banking system
Federal Trade Commission
Promotes free and fair trade competition by preventing deceptive practices, false advertising, and unfair trade practices
Fiscal Policy
The governments taxing and spending decisions. To stimulate the economy, the government spends more and lowers taxes
Free Enterprise System
capitalism
Free trade
a policy of limited government trade restrictions
Goals
An objective you want to obtain
Goods
physical items such as food and clothing
Gross domestic product (GDP)
measures the value of all goods and services produced by a nation during a specified period
Human Resources
qualities and characteristics that people have within themselves
hyperinflation
rapid, excessive, and out of control price increases
Imports
the goods and services that come into a country from other countries
Income tax
a tax on the earnings of individuals and corporations
Inflation
an overall increase in the price of goods and services
Innovation
Produces new ideas that can increase profits and make a better product
International trade
the buying and selling of goods and services across national borders
Inversion
relocation of a corporation's headquarters to a lower-tax nation through mergers and acquisitions
Investment
is an asset you buy that increases your wealth over time, but carries the risk of loss
Jobless Caims
when unemployed workers request assistance
Labor Force
composed of people, age 16 and over, who are employed or looking for and able to work
Labor productivity
the value of the goods and services a worker creates in a given time
Labor Union
a group of workers who are covered by collective bargaining aggreements
Liquid Assets
cash, savings accounts, money market accounts, checking accounts...
Market economy
a system in which privately owned businesses operate and compete for profits with limited government regulations
Marketplace
not a physical place like a mall or a grocery store but an arena in which consumers and producers meet to exchange goods, services, and money
Migrants
people who move from one place or country to another
Mixed Economy
a combination of the market and the command systems
Monetary Policy
actions the federal reserve board takes to change the supply of money and credit
Monopoly
a single seller or producer of a given product or service
Multinational corporation
a business that operates in more than one country
National Debt
the total amount of money the government owes at a given time
Needs
items a person must have to survive
Nonhuman Resources
external resources, such as money, time, equipment, and possessions
Offshore outsourcing
moving sections of a business to another country
Oligopoly
occurs when a few large companies dominate an industry
OPEC
Organization of Petroleum Exporting Countries
Open Market Operations
The Feds buying and selling Treasury securities in the market place
Opportunity Cost
the value of the best option or alternative given up
Outsourcing
when companies move sections of their business to other companies or to their own subsidiaries
Perfect competition
competition between producers results in greater innovation, better service, and lower prices for consumers
Planning Phase
Beginning a plan of action, first stage...organization
Priority
A goal or value that is given more importance than others
Producer
an individual or business that provides the supply of goods and services to meet consumer demands
Profit
the total amount of money earned after expenses are subtracted from income
Property tax
a tax that is paid on real estate owned by individuals and corporations
Prosperity
periods of growth and financial well-being
Recession
an extended period of slow or no economic growth
Reserve Requirements
the amount of cash that banks and other financial institutions must set aside rather than lend to customers
Resources
refers to any input used to generate other goods or services
Sales tax
tax added to the price of goods and services you buy
Scarcity
the challenge of stretching resources to cover needs and wants
Securities
stocks, bonds, and other investment opportunities
Securities and Exchange Commission (SEC)
Protects against fraud and enforces fair and full disclosure of financial data about securities
Services
work performed
Specialization
a trade of goods or services that it cannot produce
Stagflation
a period of slow growth and high inflation
Standard of living
the overall level of comfort of a person, household, or population as measured by the amount of goods and services consumed
Supply
the amount of a product or service producers are willing to provide
Tax
a fee imposed by government on income, products, or activities, and paid by citizens and businessess
Technology
the application of scientific knowledge to uses and products development
Trade barrier
any actions taken to control or limit imports
Trade deficit
when a country buys, or imports, more products than it sells
Trade-off
an item given up in order to gain something else
Trade surplus
when a country sells, or exports more than it buys
Traditional economy
a system in which economic decisions are based on society's values, culture, and customs.
Underemployment
workers who are employed only part time or who are "over qualified" for their jobs
Unemployment rate
the percentage of the labor forces that is out of work who are "over qualified" for their jobs
U.S. Department of Treasury
manages the finances of the federal government by collecting taxes and paying the bills
Values
A person's beliefs
Wants
items a person would like to have
World Trade Organization (WTO)
an international organization that mediates trade disputes among 151 member nations and establishes trade practices that are acceptable and fair to all nations