Traditional Economy Flashcards

Traditional Economy: Production relies on customs and traditions; roles are inherited across generations.
Command Economy: The government exerts control over economic activities and decisions.
Market Economy: Individuals and the open market dictate economic choices, promoting competition.

Specialization: Focus on a narrow range of goods and services, enhancing efficiency and production.
Opportunity Cost: Represents the value of the next best alternative when a decision is made; essential for assessing trade-offs in resource allocation.

NAFTA: North American Free Trade Agreement aimed at reducing trade barriers between the US, Canada, and Mexico.
Tariff: A tax imposed by the government on imported or exported goods, influencing trade dynamics.
Quota: A regulatory limit on the amount of a product that can be imported into a country.
Embargo: A prohibition on trade or movement of goods, often used as a political tool to restrict trade with specific nations.

Domestic: Related to home affairs or the internal dynamics of a country.
Exchange Rate: Indicates the value of one currency in relation to another, affecting international trade and investment decisions.
Human Capital: The collective skills, knowledge, and experience possessed by an individual, crucial for workforce productivity.
Capital Goods: Tangible assets (like machinery and buildings) utilized for production, contributing to long-term economic output.
GDP (Gross Domestic Product): A key indicator measuring the total economic output of a country, reflecting its economic health.
Entrepreneur: An individual who initiates and manages a business venture, assuming associated risks while driving innovation and economic growth.