Specialization improves productivity (individual becomes highly skilled at a
Division of Labor results from specialization workers divide up the tasks
that make up the job
-When the market is small, people have to have a jack-of-a
Chapter 7: Market Structures and Market Failures
In most free market economies, not all industries and markets are equally
Market structure: the organization of a market, based mainly on the degree of
competition among producers
Chapter 8: Money, Banking, Saving, and Investing
Money is anything that is generally accepted as a means of payment
3 basic functions:
1. Medium of exchangeit enables us to carry out trade and commerce easily
(much easier than barter)
Legal tender is ano
Chapter 13: Measuring the Economy
Inflation: an increase in the overall price level of goods and services produced in the economy
o ie Germany after World War 1 price of bread skyrocketed
o one cause is increase in money supply
economic indicators: data a
Chapter 12: Taxes and Taxation
Taxmandatory payment to the government
o Burdensome, but make gov. possible
o Without taxes, no public institutions no ordered society
o Taxation came in different forms in ancien
Chapter 10: Human Capital and the Labor Market
What trends shape todays labor market?
New technology is often a driving force behind changes in the job market but still
many different trends
Increasing labor force: consists of those people age 16 and ov
-1989, B. Yeltsin visits the U.S. and is surprised at choices in supermarkets Soviet
Union economy in a crisis
o What to produce?
o How and for whom?
o What benefits the country more>
-Production = land, labor, capital
Tariffs, subsidies and quotas
Stakeholder: someone who is affected by a situation, event or policy. In international trade, we a re
interested in domestic producers, foreign producers, consumers and the government
Tariffs, subsidies and quotas are forms o
Headline: Irene floods in North Carolina and New York 'disaster'
Economic concept: Production possibilities curve + factors of production
Diagram: PPF Curve
Irene floods in North Carolina and New
In August 2011, the tropical cyclone Hurric
Demand: what consumers want
2 factors when shopping:
o You have to want it
o You have to be able to pay for it
Quantity demand: the amount of a good or service that consumers are willing
and able to pay for
Demand: the amount of a good or ser
Chapter 6: Markets, Equilibrium, and Prices
Demand and supply work together to determine prices in a free market
Market equilibrium: very interaction of demand and supply drives prices to this
o Quantity of a good or service that consumers are willi
Chapter 15: The United States and the Global Economy
Global economy: the system of markets and trade that links the countries of the world;
Most of the apparel sold in U.S. is made in other countries same for electronic goods and
Characteristics o! Market Structures!
One producer -> no competition !
Unique product !
High barriers to entry!
Control over prices!
Similar products !
Some competition but only a few rms !
High barriers to e
Visiting a Foxconn factory for iPhones !
141 steps to make iPhones!
Young people working in these factories, nobody over 30!
Mostly poor people!
Takes 5 days and 325 sets of hands to make an iPhone!
Machines make the orders, not people!
Analyzing Demand and Supply Headlines
For each demand headline you analyze, do the following: (1) Record the headline in the correct row.
(2) Draw what will likely happen to the demand curve based on the headline. (3) Explain your graph.
5.5 What can cause supply to change?
Change in Supply
o Change in supply causes the entire supply circle to shift to a new position
o Change in the cost of inputs (labor, land, capital) will result in a market
Features of good diagrams
Labels must be included even when they are not
Lines should be closed, for example there should be
no gaps in the membrane of the mitochondria.
Unambiguous labels should be included. This is
related to candidates mak