TExES Social Studies 7-12 (232) Economics & Science, Tech and Soc Competency 020

Economics

This is the study of how goods, services, and property is produced, distributed, and consumed

Scarcity

This is the basis of economics, the more _____ something is the more it is worth

Opportunity Costs

This is what is not bought or what was given up to get something else

Circular Flow

This is when a consumer buys something, money flows from households to businesses which in turn businesses employ people and employees receive wages from businesses.

Supply

This is how much a producer is willing to produce at a given price.

Demand

This is how much consumers are willing to buy at a certain price

Equilibrium Price

This is the key for producers and consumers which is to find the price that will being in the most consumers at a level beneficial to producers

When supply is up demand is

Down

When supply is up price is

Down

When supply is down demand is

Up

When supply is down price is

Up

When demand is up supply is

Up

When demand is up price is

Up

When demand is down supply is

Down

When demand is down price is

Down

When price is up demand is

Down

When price is down supply is

Up

When price is down demand is

Up

When price is down supply is

Down

Traditional Economic System

This is where traditions customs and beliefs shape the good and services the economy produces such as subsistence economy - where one does what ones father did.

Traditional Economy

This system was the basis for Neolithic societies and most pre-industrial countries.

Market Economic System

This is synonymous with capitalism and free enterprise where the market determines prices and what is produced

Capitalism

This is an economic system and mode of production in which trade, industries, and the means of production are largely or entirely privately owned and most are operated for profit.

Communism

This is a socioeconomic order structured upon the common ownership of the means of production, absence of social classes, money, and the state as well as social, political, and economic ideology and movement that aims to establish this social order.

Command Economy

This is associated with communism where the government determines prices and what is produced.

Karl Marx

He is most associated with the command economy system.

Wealth of Nations

Adam Smith wrote this book that documented the world economies that were more successful than others.

Adam Smith

He wrote the Wealth of Nations and coined the term laissez faire economics

Laissez Faire Economics

Limited government involvement in basic economic decisions which remains a fundamental principle in most western economies.

Pure Competition

This is where everyone has the opportunity to engage in the producing and consuming aspects.

Pure Competition

The more producers an economy has the more _____ _____

Pure Competition

Anyone with the means and desire can become a producer of an item through _____ _____.

Monopoly

Adam Smith identified this as a problem in The Wealth of Nations.

Monopoly

This is where one producer or business that emerges to control an entire market.

Competition

Under capitalism, a lack of other producers undermines _____ and threatens the market system.

Monopolies

As an example of some _____ that are accepted would be utilities where government controls prices to ensure that the _____ do not charge unfair prices.

Standard Oil

This was a monopoly that cornered the oil market and intimidated other companies then charged unfair prices for oil; it was broken up through government action.

AT&T

This was a monopoly that cornered the telecommunications market and was broken up through government action.

Oligopoly

When only a few companies control the majority of the market an _____ has emerged.

Oligopoly

The big three American auto makers are normally considered an _____.

Oligopoly

An _____ is acceptable so long as they do not conspire to set prices.

John Maynard Keynes

He developed the driving factor behind US monetary policy.

Keynsian Economics

_____ _____ is a monetary policy where the government controls the supply of money through interest rates.

Keynsian Economics

When the government believes that more money should be in the economy then interest rates are reduced and banks loan more money to businesses and individuals. This is an example of _____ _____.

Inflation

As a way to control ______ the government determines that less money should be in circulation then the FED will raise interest rates so that less loans will be made and less money will be circulated

Inflation

This is where money loses value.

Fiscal Policy

Another example of how to increase/decrease money in circulation is through _____ _____. This is determined through the president and Congress and concerns the level of taxes and spending by the federal government.

Fiscal Policy

This takes longer than monetary policy to carry out and is considered less stable than monetary policy.

Absolute Advantage

This refers to a country that can produce an item at less cost than another country.

Comparative Advantage

This refers to a country that has less opportunity cost in producing and item

Exchange Rates

This refers to how much one country's currency is worth in relation to another country's currency.

Exchange Rate

Countries that have a lower _____ _____ can normally export more goods.

Free Trade

This is when goods can be exported and imported without tariffs.

Tariffs

These are taxes on imported goods and often are used to protect domestic businesses.

NAFTA

Countries that have free trade agreements include the US, Canada, and Mexico and belong to _____.