Economics Flashcards

capitalism

economic system in which private citizens own and use the factors of production in order to generate profits

consumer price index

statistic that measures overall changes in price or inflation over time

consumer sovereignty

the concept that the consumer is the ruler of the market

demand

desire, ability, and willingness to buy a product

depression

a state of the economy with large numbers of unemployment, supply shortages, and excess capacity in manufacturing plants

deregulation

relaxation of government regulation on industry

elasticity

a measure of responsiveness that tells us how a dependent variable such as quantity responds to an independent variable such as price

Federal Reserve System

privately owned, publicly controlled, central bank of the United States

Gross Domestic Product

the dollar amount of all final goods and services produced within a country’s borders in a year

inflation

a rise in the general level of prices

liquidity

ability to convert an asset into cash quickly

marginal utility

the extra usefulness gained from consuming one more unit of a product

minimum wage

the lowest legal wage that can be paid to most workers

money

any substance that serves as a medium of exchange, a measure of value, and a store of value

scarcity

the condition that results from limited resources combined with unlimited wants

standard of living

the quality of life based on the possession of necessities and luxuries that make life easier

supply

the amount of a product that would be offered for sale at all possible prices that could prevail in the market

tariff

a tax on an imported product

trade-off

alternatives that must be given up when one is chosen over another

unemployed

people available for work who made a specific effort to find a job during the last month and who, during the most recent survey week, worked less than one hour for pay

supply

an amount of something available for use

demand

the ability and desire to purchase goods and services

consumers

people who use goods or services for their personal benefit

capital

wealth in the form of money or property owned by a person or business and human resources of economic value

labor

productive work (especially physical work done for wages)

natural resources

the renewable and nonrenewable gifts of nature that can be used to product goods and service, including but not limited to landform and bodies of water

land

material in the top layer of the surface of the earth in which plants can grow (especially with reference to its quality or use)

management

someone who organizes the production of a business

economics

the branch of social science that deals with the production, distribution and consumption of goods and services and their management

goods

physically tangible objects that can be used to satisfy economic wants, including but not limited to food, shoes, cars, houses, books, and furniture

services

work or labor performed for someone

human resources

the physical and mental skills of people

scarcity

insufficiency of supply for needs or ordinary demands

gross income

the total amount of money a company receives from the sale of its goods and services

net income

the money a company has left over after all its costs have been paid

entrepreneur

a person who organizes, manages, and takes on the risks of a business

marketing

the commercial processes involved in promoting, selling, and distributing a product or service

wholesale

selling or related to selling goods in large quantities for resale to the consumer

retail

the selling of goods to consumers

division of labor

dividing up workers so that each worker completes one job, which is one part of a larger job

Preferred Stock

stock whose holders have precedence over common stock in claiming dividends and assets

Blue Chip Stock

companies known for consistent profits and paying dividends. they are usually well known, large-cap, and stable

Penny Stocks

a stock trading under $5. they tend to be very speculative and volatile and often end up worthless

Cyclical Stocks

stocks whose success is closely linked to the rise and fall of the general economy

Growth Stocks

a stock that generally grows faster than the S&P 500 and will likely produce consistent profits

Value Stocks

a stock that usually grows slower than the S&P 500 and are considered cheap, good for bargain hunters

Income Stock

a stock that generally grows slower than the S&P 500 and will produce profits for the long run

outstanding shares

the total number of a company’s publicly traded shares