Vocab chapter 1

Economics 101 with Scholtz at University of Wisconsin - Madison

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By: Amanda Bayer
Created: 2009-09-29
Size: 24 flashcards
Views: 39

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Economy

the social arrangements that determine what is produced, how it is produced and for whom it is produced

Economics

the study of the production, distribution and consumption of goods and services

market

an institution that brings together buyers and sellers of goods or services

market-oriented economy

an economy in which most economic decisions are made by buyers

command economy

an economy in which government either makes or strongly influences how most economic decisions are made

black markets

markets where the buyers and sellers make transactions without the government's approval

Division of Labor

the way in which the work required to produce a good or service is divided into tasks performed by different workers

specialization

when workers or firms focus on particular tasks in the overall production process for which they are well-suited

economies of scale

when the average cost of producing each individual until declines as total output increases

globalization

the trend in which buying and selling in markets have increasingly crossed national borders

exports

goods and services that are produced domestically and sold in another country

imports

goods and services produced abroad and then sold domestically

microeconomics

the branch of economics that focuses on actions of particular actors within the economy, like households, workers, and business firms

macroeconomics

the branch of economies that focuses on the ecnonomy as a whole, including issues like growth, unemployment, inflation, and the balance of trade

circular flow diagram

a diagram that views the economy as consisting of households and firms interact in a goods and services market, a labor market, and a financial capital market

goods and services market

a market in which firms are sellers of what they produce and households are the buyers

labor market

the market in which households sell their labor as workers to business firms of other employers

Financial capital market

the market in which those who save money provide financial capital and receive a rate of return from those who wish to raise money and pay a rate of return

rate of return

the payment from those who have received financial capital to those who provided it

principal

the amount of an original financial investment, before any rate of return is paid

interest rate

a payment calculated as a percentage of the original amount saved or borrowed and paid by the borrower to the saver

model

a simplified representation of an object or situation that includes enough of the key features to be useful

monetary policy

economic policies that affect bank lending and interest rates

fiscal policy

economic policies that involve government spending and taxes

About this deck

By: Amanda Bayer
Created: 2009-09-29
Size: 24 flashcards
Views: 39

About StudyBlue

“Simply amazing. The flash cards are smooth, there are many different types of studying tools, and there is a great search engine. I praise you on the awesomeness.”
Dennis