| A | B |
|---|
| laissez faire | economic system in which the govt minimizes its interference in the economy |
| market economy | economic system in which decision are made by indiviiduals rather than govt |
| command economy | economic system in which decisions are made by the government |
| competition | rivalry among producers to win business |
| standard of living | the material well being of an individual group or nation |
| profit incentive | desire to make money that motivates peopel to produce and sell goods and services |
| profit | money left over after all the costs of production have been paid |
| mixed economy | economic system that combines features of market economy and command economy |
| traditional economy | economic system in which decision are based on customs |
| equity | fairness and justice |
| Adam Smith | founder of modern capitalist economics |
| wrote Wealth of Nations | Adam Smith |
| capitalist system | another term for market economy |
| market | freely chosen activity between buyers and sellers |
| economic growth | expansion of the economy to prodcute more goods, jobs and wealth |
| free enterprise | system by which individuals may own and control the factors of production |
| values and goals | determine what kind of econmic system will develop in that country |
| private property | goods owned by indiviuals and groups and not by govts. |
| invisible hand | term used by Adam Smith to describe the effect of competition in guiding idvividuals toward workign for their own self interest thereby achieving the maximum good for society |
| proletariat | the working class |
| bourgeoisie | owners or capitalists; upper class |
| Das Kapital | Marx's book about capitalism |
| Wealth of Nations | Adam Smith's book about the importance of competition |
| authoritarian socialism | communism |
| democratic socialism | the govt pays people for their property and operates means of production in the interest of the people; people retain their human rights |
