| A | B |
|---|
| free enterprise system | economic system in which people have important rights to make economic choices of what products to buy, to own private property, and to choose to start a business and compete with other businesses |
| profit | Money that is left over after all expenses of running a business have been deducted from the income |
| goods | tangible (physical) products of our economic system that satisfy consumers wants and needs |
| factors of production | resources businesses use to produce the goods and service that people want |
| scarcity | difference between demand and supply; limited resources |
| demand | the quantity of goods or services that consumers are willing and able to buy at various prices |
| supply | The amount of goods or services that producers are willing to provide |
| equilibrium | point at which consumers buy all of a product that is supplied. At this point there is neither a surplus nor a shortage |
| gross domestic product | total market value of all goods and services, produced by workers and capital within a nation during a given period |
| opportunity cost | highest valued alternative not taken in an economic decision |
| utility | satisfaction gained from an economic decision |
| cash flow | income you have available to use for spending or saving |
| spending habits | level of spontaneity or patience you exhibit when making consumption decisions |
| cost/benefit analysis | weighing pros and cons |
| budget | financial summary of expected income and expenditures |
