| A | B |
|---|
| Traditional Economy | The type of Economy, generally 3rd world, where people fulfill basic survival needs by hunting, fishing, farming as their ancestors did. |
| Command Economy | When the government, not individuals, make all decisions about price, supply, & profit. |
| Free Market Economy | Also called Capitalism & Free Enterprise is characterized by profit motive, private ownership, competition, consumer, sovereignty (or Choice) & varying degrees of government intervention. |
| Mixed Economy | Most common type of Free Market economy which has varying degrees of government intervention (ex. health & safety standards). |
| Factors of Production | Combination of resources (natural, human, capital) necessary to make products or goods, & create services. |
| Competition | The rivalry among producers & sellers for the customer or consumer dollar which results in better quality & lower prices & advances in technology. |
| Price | The amount of money exchanged for a product or service. |
| Capitalism/Free Enterprise | The economic system (free market) which is driven by profit motive where people are free to produce buy & sell what they wish. |
| Opportunity Cost | The benefits you give up when you use your time, labor, resources for an alternative thing. An example would be football team v. after school job. |
| Economic Flow | 1. Individual/Saving, Investing 2. Businesses making products, buying & selling resources. |
