History 8 Economics, Trade, and Silk Road Vocab

Economics

the study of how people, businesses, and countries use their resources to get what they want

Goods

all tangible things that satisfy people's needs and wants

Services

activities that satisfy a want

3 factors of production

Natural resources, capital resources, and human resources.

Trade

exchange of goods or services for other goods and services

Globalization

The worldwide movement of goods, ideas, and cultures through trade. It helped start the connection between Europe and the Americas

Embargo

Stops export or imports of a product or a group of products to or from another country

Import

Get your services from other countries that we buy, do not count to our GDP

Export

Goods and services that we create and sell to other countries, count toward our GDP

Trade Deficit

When you are importing more than you are exporting

Trade Restriction

Any government policy that limits the free flow of goods and services across borders

Tariff

A tax you put on imported goods

Natural Resource

anything found in nature, not man made

Capital Resource

Resources made and used to produce, the tools used in production

Human Resource

Efforts of workers, both physical and mental to produce a good or service (labor)

Scarcity

When there is not enough goods and services to produce all wants, the biggest problem economic is trying to solve

Opportunity Cost

what you give up when you make a choice

3 economic systems

Command economy, free market economy, and mixed economy

Command Economy

The government decides what to produce, what resources to use, and who should get the goods and services, distributed based on needs and wants of states

Free Market Economy

Individuals and businesses make the decisions about what to produce, what resources to use, and who should get the goods and services

Mixed Economy

Has characteristics of a free market and command economy (in between)

GDP (gross domestic product)

Measures the value of all the money a country makes in a single year and tells us how much money the country makes

GDP per capita

GDP per person

Specialization

Individuals and businesses concentrating on a single activity or an area of expertise that makes the most money

Standard of Living

Amount of goods and services available to a group of people

How do you tell if a person uses their resources wisely?

If they are wealthy

Why do countries trade?

Keeps us from killing each other

To get the resources they want

Helps countries specialize in what they do best

Spreads ideas and cultures

Greater amount of goods and services available