| A | B |
|---|
| What is it called when you have to decide between two things you may want | choice |
| When you are making a choice, ________are the items from which you are making your choice | alternatives |
| When you are making a decision you n eed to consider the good things; the good things are _________. | benefits |
| The bad things about the decision are the ________. | costs |
| When a person makes a choice between two items the item not chosen is called the ____________. | opportunity cost |
| _________are THINGS that are exchanged for payment | goods |
| Labor done in exchange for payment | services |
| people whom buy and use goods and services | consumers |
| people doing mental or physical work to produce goods and services | human resources |
| gifts of nature that can be used to produce goods and services (trees, eggs) | natural resources |
| goods made by people to help produce other goods and services (tools, buildings, and tractors) | capital resources |
| Capital, entrepreneurship, land, labor | factors of production |
| the exchange of one thing for another thing | trade |
| to trade one good or service for another good or service without using money | barter |
| something we use to help us make exchanges for the goods and services we want | money |
| the amount of money required to exchange for a good or service | price |
| is exchanging money for items that someone wants now | spending |
| is keeping (not spending) money to purchase items later in the future | saving |
| is a place where people put their money or borrow money | bank |
| need | is something that a person cannot live wtihout. |
| want | is something that a person would like to have but can live without . |
| producer | is a person or business that makes a good or provides a service . |
| budget | is a plan for deciding what to do with your money . |
| opportunity cost | is what you give up to get something else . |
| specialization | when producers focus on one good or service they are especially suited for. |
| interdependence | is when people depend on others to provide goods and services . |
| supply | is the amount of goods which are produced . |
| demand | Amount of a good/service consumers are willing to purchase |
| investment | Money placed in stock or something that will yield greater value later |
| stock | is apart of a company that investors buy . |
| profit | is the extra money a business makes after their expenses. |
| loan | money borrowed in exchange for interest paid later |
| interest | money paid for a loan or earned for savings |
| transporation | to carry products to consumers . |
| communication | to connect information with consumers. |
| Traditional | economy based on time-honored ways; bartering |
| Command | Economy where government makes all deicisions about production & services |
| Market | Economy where supply & demand determines production, services, prices |
| Mixed | Private ownership + Government Regulation |
| laissez faire | "hands off"; little/no gov't regulation |
| FDIC | regulates banks, insures depositors |
| Communist | Type of government using a command economy |
| Federal Reserve | controls money supply and interest rates |
| inflation | prices going up |
| economic system | how the goods and services are controlled in a country |
| scarcity | unlimited wants + limited resources |
| quantities | the number or amount of something |
| regulation | another word for control; usually by the Gov't |
| comparative advantage | Ability of a country to to produce a good at a lower opportunity cost than that of other countries |
| embargo | Complete restriction on imports |
| imports | goods bought from other countries for domestic use |
| foreign exchange market | Buys and sells foreign currency for businesses that want to buy imports |
| depreciation | Fall in price of currency through supply and demand |
| import quota | Limits the amount of a particular good that can be imported |
| absolute advantage | Ability of one country to produce more output per unit of input than another country |
| protectionism | Argues that jobs, infant industries, and economic security are threatened by relaxed trade restrictions |
| protective tariff | Raised the cost of imports to protect domestic producers |
| tariff | A tax on imports |
