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Economics quiz #1
GDP (gross domestic product)
Total value of country's production.
Econimics
a social science that fucsuses on the production, distrubution, and consumtpion of goods and services
macroeconimcs
the overall economy, studying big factors like unemployment, inflation, and national income, and how they affect a country's growth
CPI (consumer price index)
Average price of common goods.
minimum wage
Lowest legal pay for workers.
inflation
Rising prices of goods and services over time.
unemployment rate
Percentage of people without jobs but seeking work.
communism
a system where the government owns everything, and everyone shares equally, controlled by workers, credit Karl Marx
primitivism
advocates for a simpler, pre
fuedilism
a system where landowners control land and people work for them.
What is capitalism?
An economic system where private individuals own and control businesses and property, aiming to make a profit.
What is the role of markets in capitalism?
Markets are free of the means of production and remain private in capitalism.
microeconomics
how people and businesses decide what to buy, sell, and produce, and how these choices affect prices.
stock market
Place to buy and sell stocks.
economic indicator
Measure showing the health of the economy.
What concept is associated with the idea of self
regulation in capitalism?
Karl marx
a philosopher who studied class struggle and capitalism.
What is socialism?
A system where the government owns and controls major industries, aiming for equal distribution of wealth.
Why is the equal distribution of wealth important in socialism?
The product of an economy should always have a stake in the society.
What is the main belief of Keynesian economics?
Believes in the value of government intervention in markets to stabilize and regulate.
What is Keynesian economics' view on capitalism?
Keynesian economics likes capitalism and believes it can work, but also believes that the market needs correction.
According to Keynesian economics, what is essential for a stable economy?
A good and smart partnership with the government is essential for a stable economy.
progressive taxation
creates less economic inequality, increased taxes based on income so government has more money stored
What is the main economic concept embraced in Classical Liberalism?
The invisible hand in the market
What is the stance of Classical Liberalism on government intervention in the economy?
Little to no government intervention
How does Classical Liberalism view taxation?
Taxation should be minimal
According to Classical Liberalism, what can disrupt a consumer economy?
Government involvement
Who is the economist associated with the concept of Neoliberalism?
Hayek
What is the core belief of Neoliberalism regarding government and regulations?
Believes people are rational, government is a problem, but regulations should still exist when necessary
The Basic Assumptions
Scarcity, Trade off, Self Interest, Cost and Benefits, Models and Graphs
Scarcity
no infinite supply of everything, the more scarce the higher the value
Trade
Off
Self
Interest
Cost and Benefits
CBA(cost benefit analysis), Evaluating advantages versus disadvantages of choices
Models and Graphs
economics = rational/ understandable, decisions can be predicted
Factors of Production
Capital, Entrepreneurship, Land, Labor
Capital
Resources (money, investment), more money necessary to purchase things you need
Entrepreneurship
management and risk taker
Land
production requiers space, real
Labor
people or machines to do the needed work
Challenges of the Factors
Immigration, Climate Change, Digitilization
Note
Flashcard