H Econ Unit 1

Front 1

Need

Back 1

Something required for a person to live. (Food, Shelter, etc.)

Front 2

Want

Back 2

Something that isn't necessary for survival but is still desirable (TV, Nice Clothes, etc.)

Front 3

Economics

Back 3

The study of decision making

Front 4

Goods

Back 4

Physical items produced by people to be consumed by others.

Front 5

Services

Back 5

Actions performed for others with expectation of compensation.

Front 6

Scarcity

Back 6

When desirable resources are limited in quantity.

Front 7

Shortage

Back 7

When there is less of a desired good or service than is expected.

Front 8

Factors of Production

Back 8

The elements that come together to form a completed product.

Front 9

Land

Back 9

Unmodified natural resources (Unfiltered water, coal, ground.)

Front 10

Labor

Back 10

Effort provided by people to produce something.

Front 11

Capital

Back 11

The items or skills that are utilized by a person or business to make a product.

Front 12

Physical Capital

Back 12

Objects that in some way aid the production of finished goods; machinery.

Front 13

Human Capital

Back 13

Knowledge or skills of workers.

Front 14

Entrepreneur

Back 14

The person who puts the factors of production together in order to start a business.

Front 15

Trade-Off

Back 15

When one option is given up in favor of another.

Front 16

Guns or Butter

Back 16

An all or nothing decision. Derived from a nation's decision to focus on militarism or agriculturalism.

Front 17

Opportunity Cost

Back 17

The next best alternative given up in a trade-off.

Front 18

Thinking at the Margin

Back 18

Considering the efficiency of a decision at every possible increment.

Front 19

Productions Possibility Curve

Back 19

A graph that depicts the most efficient production of multiple goods.

Front 20

Productions Possibility Frontier

Back 20

The edge of the PPC that represents maximum efficiency.

Front 21

Efficiency

Back 21

How fully resources are used in the creation of a product; how much is wasted.

Front 22

Underutilization

Back 22

When efficiency is not at its peak, making less than you can.

Front 23

Cost

Back 23

What is given up to produce something.

Front 24

Law of Increasing Cost

Back 24

To keep your rate of production constant, you must increase the amount of resources used.

Front 25

Economic System

Back 25

The basic guidelines as to how a group makes economic decisions.

Front 26

Standard of Living

Back 26

The level of wealth, comfort, and prosperity within a given group.

Front 27

Traditional Economy

Back 27

An economic system based on precedent and ritual.

Front 28

Market Economy

Back 28

An economic system with little to no government involvement in economic decisions.

Front 29

Centrally Planned Economy

Back 29

An economic system in which all economic decisions are controlled by the government.

Front 30

Command Economy

Back 30

Same as a Centrally Planned Economy.

Front 31

Mixed Economy

Back 31

A mix of aspects from both Market and Command Economies. Some government involvement and some freedom.

Front 32

Market

Back 32

A place, literal or figurative, where buyers and sellers can trade goods.

Front 33

Specialization

Back 33

Limiting production to only certain products.

Front 34

Profit

Back 34

When what you gain from selling a product or service is above the cost of developing it.

Front 35

Self-Interest

Back 35

An interest in someone's own economic gain.

Front 36

Incentive

Back 36

An expectation that motivates people to act a certain way.

Front 37

Competition

Back 37

Struggle between sellers to attract the most buyers.

Front 38

Invisible Hand

Back 38

Self-regulating nature of the market.

Front 39

Socialism

Back 39

Democratically instituted command economy in which wealth is intended to be distributed evenly.

Front 40

Communism

Back 40

Command economy instituted by a forceful uprising of working-class people.

Front 41

Vladimir Lenin

Back 41

The founder of communism in Russia and in turn, the USSR.

Front 42

Authoritarian

Back 42

A governmental philosophy requiring strict adherence to rules.

Front 43

Laissez-Faire

Back 43

An economic philosophy proposing that governments relinquish all influence in their nation's economic markets.

Front 44

Private Property

Back 44

Property owned by individuals, not the government.

Front 45

Free Enterprise

Back 45

Private ownership of capital goods.

Front 46

Privatize

Back 46

Selling governmental institutions to private owners.

Front 47

Karl Marx

Back 47

The founder of communism.

Front 48

Adam Smith

Back 48

The creator of Laissez-faire capitalism

Front 49

Profit Motive

Back 49

Financial gain made in a transaction.

Front 50

Free Contract

Back 50

People decide which arrangements they enter into.

Front 51

Voluntary Exchange

Back 51

People decide what they buy and sell.

Front 52

Interest Group

Back 52

An organization that speaks on behalf of a group of people.

Front 53

Public Disclosure Laws

Back 53

Laws requiring companies to provide full and true information about their products.

Front 54

Public Interest

Back 54

Concerns of people as a whole.

Front 55

Macroeconomics

Back 55

The study of how people in general make economic decisions.

Front 56

Microeconomics

Back 56

The study of how small groups or individuals make economic decisions.

Front 57

Gross Domestic Product

Back 57

The total value of all goods and services produced within a nation.

Front 58

Business Cycle

Back 58

A repetitive pattern of economic expansion and contraction.

Front 59

Work Ethic

Back 59

A commitment to the quality of the product you produce.

Front 60

Public Good

Back 60

A good or service which must be provided for free.

Front 61

Public Sector

Back 61

Part of the economy which includes individuals and companies.

Front 62

Private Sector

Back 62

Part of the economy composed of the government.

Front 63

Free Rider

Back 63

People benefiting from goods or services provided as public goods for other people.

Front 64

Market Failure

Back 64

When the distribution of wealth in a market is not equal.

Front 65

Externality

Back 65

Effects of economic decisions on those they were not intended for.

Front 66

Poverty Threshold

Back 66

The amount of money deemed necessary for a person's survival.

Front 67

Welfare

Back 67

Government aid for those in poverty.

Front 68

Cash Transfers

Back 68

Welfare through direct monetary allotments.

Front 69

In-Kind Benefits

Back 69

Welfare through the provision of goods or services.