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Economics
Chapter 18 & 19 Vocabulary
| Term | Definition |
|---|---|
| goods | tangible products that we use to satisfy our wants and needs |
| services | work performed by a person or someone else |
| natural resources | gifts of nature that make production possible |
| capital | previously manufactured goods used to make other goods and services |
| entrepreneurs | individuals who start businesses, introduce new products, and improve management techniques |
| GDP (Gross Domestic Product) | the total value of goods produced in a country |
| division of labor | the breaking down of a job into separate, smaller tasks to be performed individually |
| competition | the struggle that goes on between buyers and sellers to get the best products at the lowest prices |
| profit | the money a business receives for its products or services over and above its costs |
| laissez-faire | to let alone; government should not interfere with the marketplace |
| warranty | the promise made by a manufacturer or a seller to repair or replace a product within a certain time period if it is faulty |
| disposable income | money income left after all taxes on it have been paid |
| discretionary income | money income left after necessities have been bought and paid for |
| interest | the payment people receive when they lend money or allow someone else to use their money |
| needs | requirements for survival, such as food, clothing, and shelter |
| wants | things we would like to have, such as entertainment, vacations, and items that make life comfortable and enjoyable |
| scarcity | not having enough resources to produce all of the things we would like to have |
| communism | economic system in which the central government directs all major economic decisions |
| socialism | economic system in which government owns some factors of production and distributes the products and wages |
| trade-off | the alternative you face if you decide to do one thing rather than another |
| opportunity cost | the cost of the next best use of time and money when choosing to do one thing or another |
| market economy | system in which individuals own the factors of production and make economic decisions through free interaction |
| free enterprise | economic system in which individuals and businesses are allowed to compete for profit with a minimum of government interference |
| capitalism | a system in which private citizens own most, if not all, of the means of production and decide how to use them within legislated limits |
| incentive | reward offered to try to persuade people to take certain economic actions |
Created by:
jrobertson1
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