| A | B |
|---|
| economics | the body of knowledge that relates to producing and using goods and services that satisfy human wants |
| economic wants | the desire for scarce material goods and services |
| noneconomic wants | desired wants that are not scarce |
| utility | the ability of a good or service to satisfy a want |
| producer | anyone who aids in creating a utility |
| factors of production | land, labor, capital goods, and management-the four basic resources that are combined to create useful goods and services |
| natural resources | anything provided by nature that affects the productive ability of a country |
| labor | the human effort, either physical or mental, that goes into the productin of goods and services |
| human capital | the accumulated knowledge and skills of human beings-the total value of each person's education and acquired skills |
| capital goods | buildings, tools, machines, and other equipment that are used to produce other goods but do not directly satisfy human wants |
| capital formation | the production of capital goods |
| consumer goods and services | goods and services that satisfy people's economic wants directly |
| economic system | an organized way for a country to decide how to use its productive resources; that is, to decide what, how, and for whom goods and services will be produced |
| market economy | an economic system that determins what, how and for whom goods and services are produced by coordinating individual choices through arrangements that aid buying and selling goods and services |
| command economy | an economic system in which the method for determining what, how and for whom goods and services are produced is decided by a central planning authority |
| mixed economy | an economic system in which a combination of a market and a command economy are blended together to make decisions about what, how, and for whom goods and services are produced |
| privatization | when a state or country transfers its authority to provide a good or service to individuals or businesses |
| capitalizm | an economic-political system in which private citizens are free to go into business for themselves, to produce whatever they choose to produce, and to distribute what they produce as they please |
| socialism | an economic-political system in which the governemtn controls and regulates the means of production |
| communism | forced socialism where all or almost all the productive resources of a nation are owned by the government |
| private property | items of value that individuals can own, use, and sell |
| profit | the incentive, as well as the reward, for producing goods and services |
| demand | refers to the number of similar products that will be bought at a given time at a given price |
| supply | refers to the number of similar products that will be offered for sale at a particular time and at a particular price |
| competition | rivalry among ssellers for consumers' dollars |
| economic growth | occurs when a country's output exceeds its population growth |
| Consumer Price Index(CPI) | a measure of the average change in prices of consumer goods and services typically purchased by people living in urban areas |
| recession | a decline in the GDP that continues for six months or more |
| inflation | a rapid rise in prices caused by an inadequate supply of goods and services |
| business cycles | a pattern of irregular but repeated expansion and contraction of the GDP |
| depression | a long and severe drop in the GDP |
