Economics Finals Vocabulary Part 2

Soc. Studies

opportunity cost

the price of giving up one thing for another

profit

when a business has more income than expenses, it gains money

loss

when a business has more expenses than income, it loses money

competition

efforts of two or more businesses to earn the same customers

scarcity

when there are not enough goods or services available. This usually drives prices higher

incentives

when producers offer certain things to customers to convince them to choose their product

price

a lower cost incentive a business offers its customers. It can be in the form of a lower cost through coupons, sales, buy 1 get 1 free, etc.

quality

a degree of excellence incentive a business offers its customers. High quality products are made well, look/taste good, and/or last a long time

convenience

a better service incentive a business offers its customers. It makes things easier for the customer. Examples: Late hours, drive through, personal assistance, etc.

budget

a plan for the use of income and other resources, deciding how much to spend, save, etc.

barter

the exchange or trade of goods or services without the use of money

income

money that is earned through work, investments or selling things

expenses

money that is spent to pay for things people need or want

tax

money collected by the government to pay for public goods and services

savings

money that is not spent, but put aside for use at a later time

interest A

a reward paid for the use of money placed in a savings account

interest B

the fee for borrowing money

credit

borrowing money with the promise to pay or repay later for the goods, services, or money recieved

credit limit/ line of credit

the top amount of money the person is allowed to borrow

principal

the original amount of money borrowed before the interest fees are added on