LAST FINAL ECONMICS QUIZ #1

GDP (gross domestic product)

Total value of the country's production.

Economics

A social science that focuses on the production, distribution, and consumption of goods and services.

Macroeconomics

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

Primitivism: Advocates for a simpler, pre-industrial way of life.

Feudalism: 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.

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

A place to buy and sell stocks.

Economic indicator

Measure showing the health of the economy.

The concept associated with regulation in capitilism?

The invisible hand is associated with the idea of self-regulation in capitalism.

Karl Marx

A philosopher who studied class struggle and capitalism.

socialism?

A system where the government owns and controls major industries, aiming for equal distribution of wealth, product of an economy should always have a state in society

Keynesian economics?

Believes in the value of government intervention in markets to stabilize and regulate.

Keynesian economics' view on capitalism?

likes capitalism and believes it can work, but it 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, increases taxes based on income so the 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.

Neoliberalism ?

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

Trade-Off

Something scarce

Self-Interest

Hayek likes this

Cost and Benefits

CBA (cost-benefit analysis)

Models and Graphs

Economics = rational/understandable

Factors of Production

Capital, Entrepreneurship, Land, Labor.

Capital

Resources (money, investment)

Entrepreneurship

Management and risk-taker.

Land

Production requires space, real estate, office buildings.

Labor

People or machines to do the needed work.

Challenges of the Factors

Immigration, Climate Change, Digitalization.