Financial Literacy - Pre Theme Unit

Capital

Money or assets used to start a business

Consumer

Person who buys goods & services

Consumption

The process of buying a good or service

Corporation

A form of business that is legally separate from it’s owners & guided by a board of directors

Entrepreneurship

Start a business in order to create value & earn a profit

Four Factors of Production

The resources to make goods & services: natural resources, human labor, capital, & entrepreneurial talent

Free Enterprise

A system in which economic decisions are made by people & businesses with little government influence

Human Labor

The physical & mental effort used to produce goods & services

Loss

The total cost of production exceeds revenue

Mixed Market Economy

Private businesses and government share control of the economy and it’s decisions

Natural Resources

Materials used in production that are from nature

Opportunity Cost

Alternative given up as a result of giving a choice (EX: picking between two types of shoes)

Partnership

A business owned by 2 or more people who share control/ownership with unlimited liability

Profit

Money earned in excess of what it costs to produce goods & services

Revenue

Money earned from sales

Scarcity

Limited resources that are wanted by many people

Self Intrest

Factor that leads individuals to make actions that gives them personal benefit & that involve less money

Shareholders

People who own part of a public company; they shares of stock.

Sole Proprietorship

Business that is owned & operated by 1 person with unlimited liability

Stakeholders

An individual, employees, families, and communities that are affected by a company doing business in their area

Stock

A share in ownership of a company