| A | B |
|---|
| Bond | A financial promise for an investment issued by a corporation or government with regular interest payments and repayment at a later date. |
| Command economy | A system in which decisions are made largely by an authority such as a feudal lord or government planning agency. |
| Competition | The rivalry among people and/or business firms for resources and/or consumers. |
| Consumer | One who buys or rents goods or services and uses them. |
| Corporation | A business firm that is owned by stockholders and is a legal entity with rights to buy, sell and make contracts. Its chief advantage is that each owner's liability is limited to the amount of money he or she has invested in the company. |
| Deflation | A general decline in the price level. |
| Demand | The different quantities of a resource, good or service that potential buyers are willing and able to purchase at various prices during a specific time period. |
| Depression | A severe recession in terms of magnitude and/or length. |
| Economic systems | The way societies organize to determine what goods and services should be produced, how goods and services should be produced and who will consume goods and services. Examples include traditional, command and market. |
| Economics | The study of the behavior of individuals and institutions engaged in the production, distribution and consumption of goods and services. |
| Entrepreneur | Individual who begins, manages and bears the risks of a business (e.g., Milton Hershey, F.W.Woolworth). |
| Federal Reserve System | The “Central Bank” of the United States (consisting of the Board of Governors and 12 district banks) which controls monetary policy; sometimes referred to as "The Fed" or Federal Reserve. |
| Fiscal policy | Government decisions on taxation and spending to achieve economic goals. |
| Goods | Objects that can satisfy people's wants. |
| Incentives | Factors that motivate or influence human behavior. |
| Income | Payments earned by people in exchange for providing resources used to produce goods and services. |
| Inflation | A general rise in the price level. |
| Interdependence | Ideas, goods and services in one area affect decisions and events in other areas reducing self-sufficiency. |
| Interest | Payment made for the use of borrowed money. |
| Interest rate | The price of borrowed money. |
| Labor force | That part of the population which is employed or actively seeking employment. |
| Labor union | An organization of workers who seek to improve their common interests. |
| Law of demand | The lower the price of a good or service, the greater the quantity that people will buy, all else held constant (e.g., incomes, tastes). |
| Law of supply | The higher the price of a good or service, the greater the quantity that business will sell, all else held constant (e.g., resource costs, technology). |
| Market | A place or process through which goods and services are exchanged. |
| Market economy | An economic system in which decisions are made largely by the interactions of buyers and sellers. |
| Mixed economy | An economic system in which decisions are made by markets, government and tradition. |
| Monetary policy | Government decisions on money supply and interest rates to achieve economic goals. |
| Money | A medium of exchange. |
| Money supply | The amount of liquid assets which exists in the economy at a given time (e.g., currency, checkable deposits, travelers’ checks). |
| Mutual fund | An investment option that uses cash from a pool of savers to buy a wide range of securities. |
| Natural resources | Anything found in nature that can be used to produce a product (e.g., land, water, coal). |
| Partnership | A business in which ownership is shared by two or more people who receive all the profits and rewards and bear all the losses and risks. |
| Price | The amount people pay in exchange for a particular good or service. |
| Producer | One who makes goods or services. |
| Productivity | Amount of output per unit of input over a period of time. It is used to measure the efficiency with which inputs can be used. |
| Profit | Total revenue minus total costs. |
| Progressive tax | A levy for which the percentage of income used to pay the levy increases as the taxpayer’s income increases. |
| Recession | A contraction in National production that lasts six months or longer. A recession might be marked by job layoffs and high unemployment, stagnant wages, reductions in retail sales and slowing of housing and car markets. |
| Resources | Inputs used to produce goods and services; categories include natural, human and capital. |
| Scarcity | An economic condition that exists when demand is greater than supply. |
| Services | Actions that are valued by others. |
| Stock | A certificate representing a share of ownership in a company. |
| Tariff | A surcharge placed on imported goods and services. The purpose of a tariff is to protect domestic products from foreign competition. |
| Trade | Voluntary exchange between two parties in which both parties benefit. |
| Traditional economy | An economic system in which decisions are made largely by repeating the actions from an earlier time or generation. |
| Wants | Desires that can be satisfied by consuming goods, services or leisure activities. |
