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16 Cards in this Set
- Front
- Back
a particular set of institutional arrangements and a coordinating mechanism-- to respond to the economizing problem
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economic systems
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-also known as socialism or communism
-in this system the gov't owns most property resources and economic decision making occurs through a central economic plan |
command system
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-polar alternative to the command system
-the system characterized by the private ownership of resources and the use of markets and prices to coordinate and direct economic activity -capitalism |
market system
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"let it be"
-keep government from interfering |
laissez-faire
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-ensures that entrepreneurs and private businesses are free to obtain and use economic resources to produce their choice of goods and services and to sell them in their chosen markets
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Freedom of enterprise
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-enables owners to employ or dispose of their property and money as they see fit
-it allows workers to try to enter any line of work for which they are qualified -it ensures that consumers are free to buy the goods and services that best satisfy their wants and that their budgets allow. |
Freedom of choice
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the motivating force of the various economic units as they express their free choices
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self-interest
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-two or more buyers and two or more sellers acting independently in a particular product or resource market
- freedom of sellers and buyers to enter or leave markets, on the basis of their economic self-interest |
competition
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an institution or mechanism that brings buyers and sellers into contact
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market
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using the resources of an individual, firm, region, or nation to produce one or a few goods or services rather than the entire range of goods and services
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specialization
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contributes to a society's output in several ways
-human specialization |
division of labor
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Specialization/division of labor:
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1. Specialization makes use of differences in ability.
2. Specialization fosters learning by doing. 3. Specialization saves time. |
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Money is a:
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medium of exchange
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swapping goods for goods, say wheat for oranges is to:
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barter
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determination by consumers of the types of quantities of goods and services that will be produced with the scarce resources of the economy; consumers' direction of production through their dollar votes
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consumer sovereignty
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the "votes" that consumers and entrepreneurs cast for the production of consumer and capital goods, respectively, when they purchase those goods in product and resource markets
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dollar votes
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