Coach Sutton
| Question | Answer |
|---|---|
| Act of buyers and sellers freely and willing engaging in market transactions. | Voluntary Exchange |
| Incentive that encourages people and organizations to improve their material well-being. | Profit Motive |
| Organized way in which a society provides for the wants and needs of its people. | Economic System |
What encourages people to improve their material well-being?
For most people, it is profit motive, the incentive that encourages people and organizations to improve their material well-being by seeking to gain from economic activities. Producers want the highest profit and consumers want competition to drive down cost.
What part of the economy involves the transactions of individuals and businesses?
Chapter 3 – vocabulary practice
| A | B |
|---|---|
| part of the economy involving transactions of individuals and businesses, or the private | sector |
| direct payments of money to poor, disabled, and retired people | cash transfers |
| process used to produce a good or service | technology |
What motive drives people and organizations to improve their material well-being?
Profit motive – driving force that encourages people and organizations to improve their material well-being; characteristic of capitalism and free enterprise.
What are two things that a command economy fails to provide consumers?
What are two things that a command economy fails to provide consumers? Competition and consumer sovereignty.
What is an example of something that self interest would not?
What is an example of something that self-interest would not motivate consumers to provide? An efficient highway system. Why might this public good be unreasonable to expect from private providers? Profit incentives would not motivate private builders to construct an efficient highway system.
Which is the branch of Economics that deals with the whole economy?
Macroeconomics is the branch of economics that deals with the structure, performance, behavior, and decision-making of the whole, or aggregate, economy.
Which is the best description of macroeconomics?
Economics: The study of how people use their scarce resources to satisfy their unlimited wants. Macroeconomics: Study how decisions of individuals coordinated by markets in the entire economy join together to determine economy-wide aggregates like employment and growth. They study the performance of the economy as a whole.
What are some ways that economic growth can be achieved?
Other factors help promote consumer and business spending and prosperity. Banks, for example, lend money to companies and consumers. As businesses have access to credit, they might finance a new production facility, buy a new fleet of trucks, or start a new product line or service.
How are economic decision makers involved in the economy?
They study the performance of the economy as a whole. Market: Means by which individuals interact to buy or to sell; mechanism that coordinates the independent intentions of buyers and sellers.
