Economics Vocabulary Study Guide Name ______P.___
economics / the study of how things are made, bought, sold, and used.goods / anything that can be manufactured or grown
services / something done for others in exchange for money
resources / anything used to produce a good or a service
consumers / people who buy or use a good/service.
supply / amount of a good or a service available to consumers
demand / the amount of a good or service that consumers are willing to buy
capital / money needed to produce goods and services
gross income (revenue) / total amount of money made
net income (profit) / amount of money left after expenses are paid for
entrepreneur / a person who starts a new business (risk taker) ; pulls together labor resources; capital and natural resources
opportunity cost / what you give up when you make one choice over another (trade off)
marketing / includes advertising, shipping, storing, and selling of goods
traditional economy / an economy in which people supply the goods they need by methods passed down from ancestors
free market economy / privately-owned production, supply and demand, competition, and profit motivate producers and consumers
planned (command) economy / government controls production/distribution; no competition, not run for profit
mixed economy / most means of production are privately-owned and buyers and sellers make decisions based on consumer wants and needs, but government can guide and regulate economy(usually for safety)
capitalism / people put money (capital) into businesses and hope for a profit
recession / a slowdown of economic activity
depression / a severe recession…lasts a long time…
Gross Domestic Product / total value (in dollars) of all goods and services produced in a country each year
standard of living / quality of life based on amount of goods/services one can purchase plus amount of leisure time
Investment / Money used to start a business venture or buy materials
inflation / general rise in prices of most goods and services
profit / the income that remains after a business has paid off its expenses, taxes, and other costs
corporation / a large business that has many owners