BUS-121-51 Chapter 1

$700 billion bailout plan created to stabilize the nation's economy and restore confidence in the banking and financial industries

the system of business in which individuals are free to decide what to produce, how to produce it, and at what price to sell it.

the organized effort of individuals to produces and sell, for a profit, the products and services that satisfy society's needs.

what remains after all business expenses have been deducted from sales revenue.

all the different people or groups of people who are affected by the policies and decisions made by an organization.

the study of how wealth is created and distributed.

the study of the decisions made by individuals and businesses.

the study of the national economy and the global economy.

the way in which people deal with the creation and distribution of wealth.

resources used to produce goods and services.

a person who takes a calculated risk, time, effort, and money to start and operate a business.

an economic system in which individuals own and operate the majority of businesses that provide goods and services.

a term created by Adam Smith to describe how an individual's own personal gain benefits others and a nation's economy.

an economic system in which businesses and individuals decide what to produce and buy, and the market determines quantities sold and prices.

an economy that exhibits elements of both capitalism and socialism.

goods and services purchased by individuals for personal consumption.

an economic system in which the government decides what goods and services will be produced, how they will be produced, for whom available good and services will be produced, and who owns and controls the major factors of the production.

the key industries are owned and controlled by the government.

the average level of output per worker per hour.

the total dollar value of all goods and services produced by all people within the boundaries of a country during a 1-year period.

a general rise in the level of prices.

a general decrease in the level of prices.

a monthly index that measures the changes in prices of a fixed basket of goods purchased by a typical consumer in an urban area.

an index that measures prices at the wholesale level.

the recurrence of periods of growth and recession in the nation's economic activity.

two or more consecutive 3-month periods of decline in the country's GDP.

a severe recession that lasts longer than a secession.

Federal Reserve decisions that determine the size of the supply of money in the nation and the level of interest rates.

government influence on the amount of savings and expenditures; accomplished by altering the tax structure and by changing the levels of government spending.

a shortfall created when the federal government spends more in a fiscal year than it receives.

the total of all federal deficits.

rivalry among businesses for sales to potential customers.

the market situation in which there are many buyers and sellers of a product, and no single buyer or seller is powerful enough to affect the price of that product.

the quantity of a product that producers are willing to sell at each of various prices.

the quantity of a product that buyers are willing to purchase at each of various prices.

the price at which the quantity demanded is exactly equal to the quantity supplied.

a market situation in which there are many buyers along with a relatively large number of sellers who differentiate their products from the products of competitors.

the process of developing and promoting differences between one's products and all similar products.

a market (or industry) in which there are few sellers.

a market with only one seller.

an industry requiring huge investments in capital and within which any duplication of facilities would be wasteful and thus not in the public interest.

a loose, subjective measure of how well off an individual or society is mainly in terms of wants satisfaction through goods and services.

a system of exchange in which goods or services are traded directly for other goods and/or services without using money.

a method of manufacturing in which an entrepreneur distributes raw materials to various homes, where families process them into finished goods to be offered for sale by the merchant entrepreneur.

a system of manufacturing in which all the materials, machinery, and workers required to manufacture a product are assembled in one place.

the separation of manufacturing process into distinct tasks and the assignment of the different tasks to different individuals.

the organized effort of individuals to produce and sell through the Internet, for a profit, the products and services that satisfy society's needs.

meeting the needs of the present without compromising the ability of future generations to meet their own needs.

• Capitalism
• Command

• Perfect
• Monopolistic
• Monopoly