Market Economies

When customers and business owners exchange products and money, because it will help them both in some way.

• voluntary exchange

• volunteering to help someone for free

• opportunity cost

• reading quizzes

Buyers choose what items are produced based on their spending habits

• Consumer Sovereignty

• Factors of Production

• Efficiency

• Cost / Benefit Analysis

Focusing on a narrow range of products/services that can be produced most efficiently and cost-effectively.

• subsistence

• specialization

• scarcity

• bartering

A economist who introduced the steady increase of the supply of money within growing economies.

• David Ricardo

• John Maynard Keynes

• Milton Friedman

• Beatrice Webb

The concept that people have the right and privilege to control their possessions as they wish.

• legal equality

• open opportunity

• private property

• profit incentive

A local yard sale would be considered which economic system?

• Mixed Economies

• Market Economies

• traditional Economies

• command Economies

—Measure of value that allows producers and consumers to determine worth.

• Money

• Barter

• Trade

• Utility

What are the 3 basic Economic questions?

• Who, what, and for when to buy?

• Why, for what, and for whom to decide?

• When, why, and how to galvanize?

• What, how, and for whom to produce?

According to Adam Smith, everyone makes decisions that are best for themselves

• MACRO Economics

• Opportunity Costs

• Invisible Tradeoff Theory

• Invisible Hand Theory

What is the primary characteristic of a market economy?

• Government control over resources

• Central planning of production

• Private ownership and voluntary exchange

• Fixed pricing by authorities