Econ

Labor

The human factor of production

Capital

Anything that can be used to produce more of a good or service

Demand

The quantities of a good that consumers are willing and able to purchase at various prices during a given period of time

Supply

The quantities of a product or service that a firm is willing and able to make available for sale at different prices

Equilibrium price

The price at which the quantity demanded equals the quantity supplied

Equilibrium quantity

The quantity at which the quantity demanded equals the quantity supplied

Traditional economy

An economy in which the major economic questions are based on tradition and what has been done in the past. Profit and economic growth are NOT a concern.

Command economy

An economy in which the major economic questions are answered by a central authority (usually the government)

Market/Mixed Economy

An economy in which the major economic questions are decided mostly by individuals in the marketplace

Insurance

Coverage by contract for an agreed payment one party agreed to guarantee another against loss or damage

Bond

A loan to /from a corporation or government with a term of repayment/ Interest

Stock

Shares of ownership in a corporation

Mutual Fund

Investment that brings together money from many people and invests it in stocks, bonds or other assets.

Opportunity cost

The value of any alternative that you give up when you make a choice

Scarcity

The condition that occurs because peoples wants and needs are unlimited, while the resources needed to produce goods and services to meet these needs are limited

Consumer price index (CPI)

Used to measure inflation

Inflation

The rise in the average level of prices

Unemployment

When people are not employed (16 years of age and older and must be seeking employment)

Ferderal reserve

The central banking system in the United States

Loose money (monetary policy)

Causing the economy to run more rapidly by lowering the discount rate, selling open market operations, and lowering the reserve requirement

Tight money (monetary policy)

causing the economy to slow down by raising the discount rate, buying open market operations, and raising the reserve requirement

Interest

The price paid for the use of money

Excise tax

A tax on a specific good or service

Tax

A charge imposed by the government on people or property for public purposes

Indirect tax

A tax that an be shifted, at least in part, to a party other than the one on whom the tax was levied

Direct tax

A tax that is directly levied on the party of whom it is to be paid by

Regressive tax

A tax that takes a longer percentage of higher incomes and a lower percentage of lower incomes

Progressive tax

A tax that takes a larger percentage of higher incomes and a lower percentage of lower incomes

Benefit Principle

When a tax is levied on the party that will benefit from where the tax money is spent (state park fees, gas tax)

Ability - to - pay principle

When a tax is levied at a higher percentage on those that have more resources to pay more of it (federal income tax)

Expansionary fiscal policy

Causing the economy to run more rapidly by increasing spending and / or cutting taxes

Restrictive fiscal policy (fiscal policy - government elected officials)

causing the economy to slow down by decreasing spending and / or raising taxes

Budgeting deficit

The amount by which government spending exceeds revenues each year

Tariff

A tax on imports

Quota

A limit on the amount of imports or exports

Standard

Certain specifications a good or service has to meet

Dumping

Selling a product in a foreign country at prices below cost or below domestic prices

Comparative advantage

When a country benefits in trade from being more efficient in producing a good or service by having the lower opportunity cost

Subsidy

A payment or financial assistance made by the government to encourage some economic activity

National debt

The amount of money that the federal government owes ($30 trillion)