Command Economy Flashcards

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Questions and Answers

What is a command economy?

An economic system controlled by the government (correct)

A mixture of private and state enterprises

An economy based on market forces

An economy focused on habits and customs

What is a market economy?

An economy that relies chiefly on market forces to allocate goods and resources and to determine prices.

What defines a traditional economy?

An economic system that relies on habit, custom, or ritual to decide questions of production and consumption.

What is a mixed economy?

An economic system that combines private and state enterprises. Signup and view all the answers

What are tariffs?

Taxes on imports or exports. Signup and view all the answers

Define quotas.

Established limits by governments on the number of immigrants who can enter a country each year. Signup and view all the answers

What are embargos?

A ban on trade with another country. Signup and view all the answers

What does NAFTA stand for?

North American Free Trade Agreement. Signup and view all the answers

What is currency exchange?

The exchange rates between two currencies that specify how much one currency is worth in terms of the other. Signup and view all the answers

What is GDP?

Gross Domestic Product - the total market value of all final goods and services produced annually in an economy. Signup and view all the answers

Define entrepreneurship.

Accepting the risk of starting and running a business. Signup and view all the answers

What is the standard of living?

A measure of quality of life based on the amounts and kinds of goods and services a person can buy. Signup and view all the answers

What does literacy rate represent?

The percentage of people who can read and write. Signup and view all the answers

What is human capital?

The skills and knowledge gained by a worker through education and experience. Signup and view all the answers

What are capital goods?

Buildings, machinery, tools, and other goods that provide productive services over a period of time. Signup and view all the answers

Define budget.

A sum of money allocated for a particular purpose. Signup and view all the answers

What does credit mean in finance?

Used in the phrase 'to your credit' to indicate an achievement deserving praise. Signup and view all the answers

What is specialization?

The special line of work you have adopted as your career. Signup and view all the answers

What is the European Union?

An economic and political association of certain European countries with internal free trade and common external tariffs. Signup and view all the answers

What is investment?

The ceremonial act of clothing someone in the insignia of an office. Signup and view all the answers

Study Notes

Economic Systems

Command Economy: Governed by state authority where the government controls all economic activities.
Market Economy: Based on supply and demand, where prices are determined by market forces.
Traditional Economy: Driven by cultural customs and rituals, determining production and consumption through established practices.
Mixed Economy: Integrates elements of both private enterprise and government involvement in the economy.

Trade Concepts

Tariffs: Taxes imposed on imported or exported goods to regulate trade and protect domestic industries.
Quotas: Limitations set by governments on the quantity of specific goods that can be imported or exported.
Embargos: Prohibitions on trade with particular countries, often for political reasons.
NAFTA: Facilitates trade between the US, Mexico, and Canada, promoting economic collaboration in North America.

Economic Indicators

Currency Exchange: The valuation of one currency against another, crucial for international trade.
GDP (Gross Domestic Product): Total market value of all final goods and services produced annually, an indicator of economic health.
Literacy Rate: Measures the proportion of the population that can read and write, impacting economic development.
Standard of Living: Reflects the quality of life by assessing the availability of goods and services to individuals.

Human and Capital Assets

Entrepreneurship: Involves assuming risks to create and manage businesses, driving innovation and economic growth.
Human Capital: Represents the collective skills and knowledge acquired by individuals through education and experience.
Capital Goods: Tangible assets like buildings and machinery, essential for production processes over time.

Financial Concepts

Budget: A financial plan allocating resources for specific objectives or expenditures.
Credit: Refers to the trust in someone's ability to repay borrowed money, reflecting financial reliability.
Investment: The action of allocating resources towards assets or ventures with expectations of generating returns.

Careers and Specialization

Specialization: Focus on a specific profession or skill set, enhancing productivity and expertise in a chosen field.

Political and Economic Associations

European Union: A political and economic union of European countries promoting free trade and shared economic policies across members.

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Description

Explore key concepts related to command, market, and traditional economies. This flashcard set provides definitions and contrasts between different economic systems. Perfect for students studying economics or preparing for examinations.