GOV FINAL
Terms
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- The Wealth of Nations
- What was the name of Adam Smith's most famous work?
- commodity
- a product that is the same no matter who produces it, such as petroleum, notebook paper, or milk
- substitutes
- goods used in place of one another
- incentive
- an expectation that encourages people to behave in a certain way
- physical capital
- all human made goods that are used to produce other goods and services; tools and buildings
- demand
- the desire to own something and the ability to pay for it
- differentiation
- making a product different from other similar products
- elastic
- describes demand that is very sensitive to a change in price
- monopolistic competition
- a market structure in which many companies sell products that are similar but not identical
- predatory pricing
- selling a product below cost to drive competitors out of the market
- south africa
- middle market
- rationing
- a system of allocating scarce goods and services using criteria other than price
- natural monopoly
- a market that runs most efficiently when one large firm supplies all of the output
- merger
- combination of two or more companies into a single firm
- market economy
- economic system in which decisions on production and consumption of goods and services are based on voluntary exchange in markets
- subsidy
- a government payment that supports a business or market
- start up costs
- the expenses a firm must pay before it can begin to produce and sell a good
- London
- Where did Karl Marx die?
- hong kong
- free market
- franchise
- the right to sell a good or service within an exclusive market
- shortage
- a situation in which a good or service in unavailable
- russia
- moderately centrally planned economy
- invisible hand
- what controlled the market in Smith's system?
- marginal product of labor
- the change in output from hiring one additional unit of labor
- Germany
- Where was Marx from?
- search costs
- the financial and opportunity costs consumers pay when searching for a good or service
- human capital
- the skills and knowledge gained by a worker through education and experience
- north korea
- centrally planned economy
- scarcity
- limited quantities of resources to meet unlimited wants
- economies of scale
- factors that cause a producers average cost per unit to fall as output rises
- deregulation
- the removal of some governmental controls over a market
- centrally planned economy
- economic system in which the central government makes all decisions on the production and consumption of goods
- united kingdom
- moderately free market
- inferior good
- a good that consumers demand less of when their incomes increase
- oligopoly
- a market structure in which a few large firms dominate a market
- factors of production
- land, labor, and capital; the three groups of resources that are used to make all goods and services
- collusion
- an agreement among firms to divide the market, set prices, or limit production
- market power
- the ability of a company to change prices and output like a monopolist
- economics
- the study of how people seek to satisfy their needs and wants by making choices
- Scotland
- where was Adam smith from?
- normal good
- a good that consumers demand more of when their incomes increase
- substitution effect
- when consumers react to an increase in a goods price by consuming less of that good and more of another good
- fixed costs
- a cost that does not change, no matter how much of a good is produced
- substitution effect
- when consumers react to an increase in a good's price by consuming less of that good and more of other goods
- spillover costs
- costs of production that affect people who have no control over how much of a good is produced
- thinking at the margin
- deciding whether to do or use one additional unit of some resource
- ceteris paribus
- a latin phrase that means all things held constant
- black market
- a market in which goods are sold illegally
- license
- a government issued right to operate a business
- law of demand
- consumers buy more of a good when its price decreases and less when its price increases
- law of increasing costs
- law that states that as we shift factors of production from making one good or service to another, the cost of producing the second item increases
- price fixing
- an agreement among firms to charge on price for the same good
- price ceiling
- a maximum price that can be legally charged for a good or service
- perfect competition
- a market structure in which a large number of firms all produce the same product
- complements
- two goods that are bought and used together
- incentives
- In Adam Smith's economic system what drives the individual?
- price discrimination
- division of customers into groups based on how much they will pay for a good
- law of supply
- tendency of suppliers to offer more of a good at a higher price
- monopoly
- market dominated by a single seller
- privatize
- to sell state run farms to individuals