OPENSTAX PRINCIPLES OF ECONOMICS 3E - KEY TERMS FROM ALL CHAPTERS

OPENSTAX PRINCIPLES OF
ECONOMICS 3E - KEY TERMS FROM
ALL CHAPTERS
circular flow diagram - CORRECT ANSWER >>a diagram that
views the economy as consisting of households and firms
interacting in a goods and services market and a labor market


command economy - CORRECT ANSWER >>an economy where
economic decisions are passed down from government authority
and where the government owns the resources


division of labor - CORRECT ANSWER >>the way in which
different workers divide required tasks to produce a good or
service


economics - CORRECT ANSWER >>the study of how humans
make choices under conditions of scarcity


economies of scale - CORRECT ANSWER >>when the average
cost of producing each individual unit declines as total output
increases

,exports - CORRECT ANSWER >>products (goods and services)
made domestically and sold abroad


fiscal policy - CORRECT ANSWER >>economic policies that
involve government spending and taxes


globalization - CORRECT ANSWER >>the trend in which buying
and selling in markets have increasingly crossed national borders


goods and services market - CORRECT ANSWER >>a market in
which firms are sellers of what they produce and households are
buyers


gross domestic product (GDP) - CORRECT ANSWER
>>measure of the size of total production in an economy


imports - CORRECT ANSWER >>products (goods and services)
made abroad and then sold domestically


labor market - CORRECT ANSWER >>the market in which
households sell their labor as workers to business firms or other
employers

,macroeconomics - CORRECT ANSWER >>the branch of
economics that focuses on broad issues such as growth,
unemployment, inflation, and trade balance


market - CORRECT ANSWER >>interaction between potential
buyers and sellers; a combination of demand and supply


market economy - CORRECT ANSWER >>an economy where
economic decisions are decentralized, private individuals own
resources, and businesses supply goods and services based on
demand


microeconomics - CORRECT ANSWER >>the branch of
economics that focuses on actions of particular agents within the
economy, like households, workers, and business firms


model/theory - CORRECT ANSWER >>a representation of an
object or situation that is simplified while including enough of the
key features to help us understand the object or situation


monetary policy - CORRECT ANSWER >>policy that involves
altering the level of interest rates, the availability of credit in the
economy, and the extent of borrowing

, private enterprise - CORRECT ANSWER >>system where private
individuals or groups of private individuals own and operate the
means of production (resources and businesses)


scarcity - CORRECT ANSWER >>when human wants for goods
and services exceed the available supply


specialization - CORRECT ANSWER >>when workers or firms
focus on particular tasks for which they are well-suited within the
overall production process


traditional economy - CORRECT ANSWER >>typically an
agricultural economy where things are done the same as they
have always been done


underground economy - CORRECT ANSWER >>a market where
the buyers and sellers make transactions in violation of one or
more government regulations


allocative efficiency - CORRECT ANSWER >>when the mix of
goods produced represents the mix that society most desires