Economics:Competency 2

  1. resource markets
    where you exchange your labor for money to spend on goods and services
  2. circular flow
    the movement of money, products and resources between households and businesses
  3. competition
    rivalry among businesses for the consumer's dollar
  4. economic growth
    increased production of goods and services
  5. medium of exchange
    a function of money that enables people to make exchanges more easily with one another
  6. model
    a simplified representation or map of an economy
  7. consumers
    those who buy goods and services
  8. price system
    provides signals for what will be produced
  9. property right
    ownership of a good or resource
  10. profit
    money remaining after deduction costs from sales
  11. when resources are privately owned, how do people treat their property?
    they use it carefully and productively
  12. what do prices usually tell businesses?
    about the values consumers put on various products
  13. what does competition need?
  14. in resource markets, businesses compete against ________________.
    one another
  15. what does entrepreneurship do?
    promote economic growth
  16. what are the seven goals of the US economic system?
    • full employment- anyone who wants a job can get one
    • economic growth- an increase in output of goods and services
    • price stability-the prices of goods and services don't flucuate significantly
    • economic freedom- freedom of choice in economic decisions
    • economic security- the basic needs of everyone are met
    • efficiency- getting the maximum output from the resources used to produce goods and services
  17. barter
    an exchange of goods and services without using money
  18. money
    anything that is generally accepted as payment for goods and services
  19. what are the three functions of money?
    • medium of exchange- when people agree on the value of a good or service
    • store of value- you can hold on to money for use in the future
    • measure of value- the value of the money
  20. free enterprise
    people in their economic roles are free to make choices
  21. specialization
    a process businesses and people focus on producing one or a few parts on an entire product
  22. the price system
    monetary prices as a message system to facilitate exchanges between buyers and sellers
  23. entrepreneurship
    the motivation that drives business leaders to compete and react to changing conditions in the market
  24. What is an advantage of money as a medium of transaction?
    it decreases the cost of the exchange
  25. If the circular flow chart were a clock, what would be at 12:00, 3:00, 6:00 and9:00?
    • 12:00: product market
    • 3:00: businesses
    • 6:00: resource market
    • 9:00: households
  26. Give an example of how each aspect of the US's mixed economy effects your/your family's life.
    • traditional: celebrate holidays
    • market: buisnesses compete for my dollar
    • government: parents have to pay taxes
Card Set
Economics:Competency 2
high school economics claSS