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What are the four factors of production?
natural resources, labor, capital and entrepreneurship.
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What is Economics?
the branch of social science that deals with goods & services.
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What are economic products?
something that brings money into the economy.
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What are manufactured goods?
goods that have been processed by way of machinery.
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Why does the study of economics help?
Economics is the social science that deals with the production, distribution, and consumption of goods and services.
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What is the purpose of the production possibilities frontier?
a curve depicting all maximum output possibilities of two or more goods given a set of inputs.
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What is the role of the government in a command economy?
It is an economic system in which the central government makes all decisions on the production and consumption of goods & services
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What is Capitalism?
an economic system based on private ownership of capital.
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What are the characteristics of a free enterprise economic system?
Basic production facilities-land and capital-are privately owned.
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What is voluntary exchange?
when buyers and sellers are free to engage in market transactions with few outside restrictions.
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What is the role of the entrepreneur?
Entrepreneurs occupy a central position in a market economy.
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What is the main disadvantage of general partnership?
legal liability and management issues.
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How does a corporation start?
Obtaining Certificate of Incorporation from local State office or business retailer.
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How does liability work in corporations?
volunteer work, community service.
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What happens when two firms merge?
Firms will merge in order to gain market power.
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What is a verticle merger?
is between two companies producing different goods or services for one specific finished product.
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What are the different types of nonprofit organizations?
NPOs are often charities or service organizations.
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What do non-profit organizations provide?
volunteer work, community service.
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What is a professional association?
an association of practitioners of a given profession.
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What direct role does the American government play in our economic system?
With separation of powers, legislative, executive, & judicial branches are kept distinct.
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