| A | B |
|---|
| A way of providing for the wants and needs of a country's people. | Economic System |
| The people make economic decisions | Market Economy |
| Government makes the economic decisions. | Command Economy |
| Things are done the way they have been done for generations. | Traditional Economy |
| Business allowed to compete for profit. | Free enterprise |
| Factors of production are owned by private citizens. | Capitalism |
| Buyers and sellers can deal with each other without government intervention. | Voluntary exchange |
| The driving force that encourages people to work hard to improve their standard of living.. | Profit Motive |
| The results of the profit motive. | More efficient methods, new improved products, and lower prices. |
| Peoples savings provide? | Pool of money for business to borrow. |
| Consumers "__" with dollars for the products they prefer. | Vote |
| The act of using up goods and services. | Consumption |
| Consumption to impress. | Conspicuous |
| Consumption due to change in style. | Induced |
| Consumption because of a change in consumption of something else.. | Derived |
| Something that has worth has ____. | value |
| What gives things value? | scarcity and utility (usefulness) |
| Having economic resources to an economist. | wealth |
| Link between factors and consumers in free enterprise. | Business Organizations |
| A single owned business | sole proprietorship |
| Someone who takes the risk of operating their own business | Entrepreneur |
| A partner that puts in money but is not involved in decision making. | Limited Partner |
| A business that has 2 - several owners. | Partnership |
| A business that has 1 to many owners. | Corporation |
| Voting stock | Common |
| Non voting stock, but gets dividends first. | Preferred. |
| Elected by stockholders and then elect officers. | Board of Directors |
| An organization where members pay a fee in exchange for cheap prices. | Cooperative |
| A busines organization that pays no taxes. | Non profit organization |
| The biggest consumer and employer in the U.S. | Government |
| When two business get together to form one new one. | merger |
| Why would two businesses merge? | To be bigger(more capital resources)and more efficient (less human resources). |
| When two companies who do the same thing merge. | Horizontal merger |
| When a company buys another step in the production system. | Vertical merger |
| A company that has many unrelated businesses. | Conglomerate |
| THe advantages of a command economy. | Easy to shif resources. |
| Disadvantages of command economy. | Lack of incentive to work and bureaucracy. |
| The advantages of a market economy. | Flexible, freedom to produce what they want, variety of products. |
| Disadvantages of market economy. | Only productive get rewarded and much waste. |
| The characteristics of free enterprise. | economic freedom, voluntary exchange, private property, profit motive, people save for business borrowing |
| Money is: | median of exchange, a way to measure value, a way to store value |
| Out of every 5 sole proprietorships, how many fail. | 4 |
| Characteristics of sole proprietorship. | no sharing profits, unlimited liability, can't compete with "big guys" |
| Corporations have limited liability which means | Can't take personal assets of stockholders to pay debts of company. |
| What is included in articles of partnership? | duties of each partner, how profits/ losses are divided, and what happens if it ends |
