| A | B |
|---|
| consumer sovereignty | consumers are free to spend their money and have final say |
| Gross Domestic Product (GDP) | the nation's output of goods and services, sign of economic growth |
| private property | piece of land, building, vehicle, or other things owned by an individual, a family, or a group. |
| public property | city hall, part, highway, owned by a government |
| standard of living | quantity and quality of goods and services available to an individual or society. |
| Six main principles of the US economic system | Economic Growth, Economic Stability, Economic Security, Economic Justice, Economic Freedom, Economic Efficiency |
| Circular flow | Money that businesses pay out(in wages, rent, interest, dividends)returns wyen people(households)pay for goods and services. Land,labor,management and capital resources that households sell to businesses create goods and services that are bought by households. |
| Invisible hand | In a pure free enterprise system, things work out without government officials interfering, in other words, self interest provides a guiding hand. |
| Mixed Market Economy | The market alone does not make all the decisions about what will be produced. The government is involved as a buyer and seller of goods and services. |
| public interest | the concerns of the public as a whole |
| Interest group | a private organization that tries to persuade public officials to act or vote according to group member’s interests |
| Poverty threshold | the income level below that which is needed to support families or households |
| market failure | a situation in which the market does not distribute resources efficiently |
| Public good | a shared good or service for which it would be impractical to make consumers pay individually and to exclude nonpayers (ie roads, dams, bridges, national parks, schools, military, fire/police depts) |
| Externality | an economic side effect of a good or service that generates benefits or costs to someone other than the person deciding how much to produce or consume (ie—positives: road, fixing up an old house, negatives: chemical waste dumping and the clean up) |
| business cycle | a period of macro-economic expansion followed by a period of contraction |
| public policy | laws and standards on topics of public interest (Ex: taxation, aid for farmers, regulatory issues including the licensing of TV and radio stations |
| public disclosure laws | help give consumers economic freedom by requiring companies to give consumers full information about their products |
| innovation | government provides incentives for this and recognizes the need for this to maintain America's technological advantage |
