Capitalism Facts Flashcardziz

Front

What is Capitalism?

Back

An economic system in which money is invested in businesses to make profit.

Front

What is a fundamental idea of laissez-faire capitalism?

Back

Businesses should gain and lose according to their own effort.

Front

What does a sale on winter coats in June illustrate in terms of supply and demand?

Back

High supply, low demand.

Front

What book provides the basic theory of Capitalism?

Back

The Wealth of Nations.

Front

Who is the author of 'The Wealth of Nations'?

Back

Adam Smith.

Front

What is the primary goal of businesses in a capitalist economy?

Back

To generate profit.

Front

What role does competition play in capitalism?

Back

It drives innovation and efficiency among businesses.

Front

Define 'free market'.

Back

A market where prices are determined by unrestricted competition between privately owned businesses.

Front

What is the relationship between supply and demand in a capitalist economy?

Back

Prices are determined by the balance of supply and demand.

Front

What is 'consumer sovereignty'?

Back

The idea that consumer preferences determine the production of goods and services.