Economics-The study of people producing and exchanging to get the goods and services they
Goods are physical products.
Services are non-physical products that do not result in ownership.
Consumers are those who buy goods and services.
Information: The Swiss Confederation was founded in 1291 as a defensive alliance among three
cantons. the country did not officially become a UN member until 2002. Switzerland remains active
in many UN and in
Exchange Rates between two currencies specifies how much one currency is worth in terms of
Strong US Dollar
Foreign products will cost less for the US citizens
It would be cheaper for US citizens to travel abroad
US products will
A credit score is a numerical expression based on a statistical analysis of a persons credit files,
to represent the creditworthiness of that person.
Building a Credit History
Establish a steady work record.
Open a checking account and don
What is Credit-something received in exchange for a promise to pay back in the future
Borrower-request credit from lender
Lender-give borrower credit
Borrower-pays back money plus interest to lender
Interest-price of mo
Steps to buying a house
A Step By Step Look at Home Buying
Step 4: Determine Your Wants and Needs
Buying a home isnt as difficult as you might think, even if youre short on funds, but the process
will go a lot smoother if you get familiar with your real e
Teaser Paragraph: (The teaser is persuasive, professional, and makes the potential investor
want to hear more.)
Imagine that youre on your way to an important job interview, and you need to make a
quick stop to get a bite to e
Its going to rain, have an emergency fund.
Phase 1L Asses your personal financial situations (needs, values, life situation)
Phase 2: Set personal financial goals.
Phase 3: Create a budget for fixed variable expenses based on projecte
Savings-Portion of income not spent on current expenses.
You should save 6 months worth of expenses
Net Income- income after taxes have been taken out of a paycheck.
Depository Institution-business that offers financial services to people.
GDP Per Capita(Per person/household)- Per capita GDP is a measurement of nations GDP
divided by its total population
Energy Consumption-How much energy a nation consumes depends on its level of
industrialization, or the extensive organization of the econo
Total Government Involvement
Communist Manifesto by Karl Marx
USSR, Cuba, North Korea
Some government involvement
France, Canada, South Africa
Market Pure free market/free enterprise system No Government
World Trade Organization
Body Mainly responsible for drawing up and enforcing international trade agreements.
Critics argue protects wealthy countries and corporations at the expense of poor
Founded after WWII. Initial Goal: Help
What choices you have depend on the economic system
Traditional Econ.- customs say what is produced and consumed.
Command Econ (Communist)-government says what is produced and consumed.
Market Econ/Mixed/Capitalist-Individuals say what is produced and con
Demand- quantity that consumers are willing and able to buy at every given price in a given
The Law of Demand states that as the price of a good or service increases, the quantity
demanded decreases and vice versa. All else being equal, mor
Supply: Quantity or number of items that producers are willing and able to sell at every given
Law of Supply: suppliers will offer more of a good at a higher price
Supply Schedule: a table that lists the quantity a producer will sell at each
Elasticity and Inelasticity
Factors affecting Elasticity:
Availability of Substitutes-If there are few substitutes for a good, then demand will not
likely decrease as price increases. The opposite is also usually true
Equilibrium-the point where buyers will purchase exactly as much as sellers are willing to
Balancing the Market-the point at which the quantity demanded and quantity supplied come
together is known as the Market Clearing Price (i.e. equilibrium)
Spectrum of the Role of Government in the Economy
Disclosure Laws-Laws that require companies to provide consumers with important
information about their products, such as fuel efficiency of automobiles, side effects of
Unemployment-number of people without a job actively search for one.
Unemployment Rate- The unemployment rate is the percentage of the nations labor
force that is unemployed.
Those who do not count on the labor force
Serving in the military
THE STOCK MARKET
The more risk the more reward and more potential loss
The less risk the less reward and less potential loss
A stock market or equity market is a public entity (a loose network of economic transactions, not
a physical facility or discret
Macroeconomics-a branch of economics that deals with the performance, structure, and
behavior of a national as a whole.
Microeconomics-branch of economics that studies how households and firms make decisions to
allocate limited resources
The idea that markets regulate themselves is at the heart of a school of thought known
as classical economics.
Adam Smith (The Invisible Hand) is a classical economist.
The Great Depression that began in 1929 challeng
Development-How wealthy or poor a country is. There is no one single way to determine the
level of development of a country, but several indicators used
Key factors of economic growth
Physical and Human Capital