Free Enterprise Exam
Terms
undefined, object
copy deck
- The inability to satisfy all wants at the same time
- scarcity
- People have to make choices because resources are _______
- limited
- Factors of production that are used in the production of goods and services are called __________
- resources
- Name four types of resources
- natural, human, capital, entrepreneurship
- That which is given up when a choice is made is called _______ ____
- opportunity cost
- The amount of money exchanged for a good or service is the _______
- price
- ______ are used to change economic behavior
- incentives
- What determines price?
- the interaction of supply and demand
- the amount of a good or service thta producers are willing and able to sell at a certain price
- supply
- making goods or providing services
- production
- what determines what is produced
- resources available and consumer preferences
- the using of goods and services is known as _______
- consumption
- what determines what is purchased?
- consumer prefernce and price
- Name three major economic systems
-
free market
command economy
mixed economy - what makes on type of economic system different from others
- the extend of government involvement in economic decision making
- Characteristics of a _______ _____ economy are private ownership of property and resources; profit; competition; consumer sovereignty and individual choice
- free market
- this economic system is the most common in the world today. the government plays a bigger roll that in a free market economy, but less of a role that in the commany economy
- mixed economy
- in a mixed economy individuals and business are the decision makers for the ____ sector, and government is decision maker in the ______ sector.
- private--- public
- a form of business organization with one owner who takes all the risks and all the profits
- proprietorship
- who does the economic decision- making in the U.S.
- it's share by individuals, business and government
- name five characterisitcs of the U.S. economy
- free markets; private property; profit; competition; consumer sovereignty
- one characteristic of the u.s. economy is free markets. this means:
- markets are allowed to operate without undue interference from the government
- one characteristic of the u.s. economy is private property. this means:
- individuals and businesses have the right to own personal property as well as the means of production without undue interference from the government
- one characteristic of the u.s. economy is profit. profit consists of:
- earnings after all expenses have been paid
- characteristics of a ____ economy are central ownership of property and resources; centrally-planed econmy; lack of consumer choice
- command
- what would be the benefit for a business owner of turning his business into a corporation
- if the business fails, the owner won't lose his personal savings because his liability is limited to investment
- in the u.s economy, what flows continuously among households, businesses and markets
- resources, goods and services
- what do individual and business savings do for the economy?
- provide financial capital that can be borrowed for business expansion and increased consupmtion
- governments use _____ ______ from individuals and businesses to provide public gods and services.
- tax revenue
- how do financial institutions like banks encourage saving and investing?
- private financial institutions act as intermediaries between savers and borrowers
- what are some examples of private financial institutions
- banks, savings and loans, credit unions, and securities brokerages
- banks receive deposits and make ________.
- loans
- worldwide markets, buying and selling of goods and services by all nations.
- global economy
- why the united states trade with other nations
- to increase wealth
- louisiana and the united states ______ in the production of certain goods and services
- specialize
- one characteristic of the u.s. economy in competition. this means-
- rivalry between producers/sellers of a good or service results in better quality goods and services at a lower price
- one characteristic of the u.s. economy is consumer sovereignty. this means:
- consumers determine through purchases, what goods and services will be produced
- free markets are markets that are allowed to operate without ______ ___ from the government.
- undue interference
- competition results in:
- better quality goods and services at a lower price
- in the U.s., who determines thorugh purchases, what goods and services will be produced?
- consumers
- a form of business organization with tow or more owners who share the risks and the profits
- partnership
- a form of business organization that is authorized by law to act as a legal person regardless of the number of owners. owners sharethe profits. owner liability is limited to investment.
- corporation
- a person who takes a risk to produce goods and services in search of profit.
- entrepreneur
- in a proprietorship, who takes all the risks and all the profits?
- a single owner
- a business partnership has _____ ____ who share the risks and the profits?
- two or more owners
- a corporation is a from of business that is authorized by law, regardless of the number of owners, to act as:
- a legal person
- in which from of business is owner liability limited to investment?
- corporation
- what is the impact of technological innovation on world trade?
- contribute to the golbal flow of information, captial, goods, and services; lowers the cost of producion
- the government both promotes and regulates _______.
- competition
- how does the government promotes marketplace competition?
-
enforcing antitrust legislation to discourage the development of monopolies
engaging in global trade
supports business start-ups - the government promotes competition by enforcing ______ legislation to discourage the development of monopolies
- antitrust
- what are some examples of public goods and services?
- interstate highways, postal service, and national defense
- how do governments get the money to produce public goods and services?
- through tax revenue and through borrowed funds
- where does congress get the authority to tax personal and business incomes?
- 16th amendment
- the government can ______, _____, and ______ to influence economic activity.
- tax, borrow and spend
- government _____ ______ reduce the funds for private and business spending.
- tax increases
- government _____ ____ increase funds for pricate and business spending.
- tax decreases
- increased government spending ______ demand, which may _____ employment and production.
- increases, increase
- ___________ government spending reduces demand, which may result in a ______ of the economy
- less, slowing
- increased government spending may result in _____ taxes
- higher
- decreased government spending may result in ____ taxes
- lower
- the FED is the-
- federal reserve system
- the Fed is the _____ _____ of the United States.
- central bank
- the Fed regulates the
- money supply
- the reserve bank acts as a banker's bank by issuing currency and regulating the amount of ______ in circulation.
- money
- what does the Fed do to slow the economy?
- the fed can restrict the money supply, causing interest rates to rise
- why would the Fed incerase the money supply, causing interest rates to decline?
- to stimulate the economy
- what are three ways the Federal Reserve Bak can slow the economy?
- increase in the reserce requirement; raise the discount rate; sell government securities
- what are three ways the Federal Reserve Bank can stimulate the economy?
- lower the reserve requirement; lowers the discount reate; purchases government securities
- how does the U.S. government protect consumer rights and property rights
- the government passes laws and creates agencies to protect consumer rights and property rights
- how is public health and safety protected?
- government agencies establish guidelines that protect public health and safety.
- what kind of advancements create new jobs in the workplace?
- technological advancements