Unit Four Vocabulary

Traditional Economy An economic system in which social roles and culture determine how goods and services are produced and distributed

Command Economy An economic system in which the government decides how goods and services are produced and distributed

Market Economy An economy that allows business owners to compete in the market with little government interference

Continuum Most economies are not pure market or pure command. They are somewhere in between. Everything in between is part of the continuum. Pure Command Pure Market

Voluntary Trade Voluntary trade is voluntary exchange of goods and services between people and/or countries. This is the concept that people may decide what and when they want to buy and sell.

to pursue some special line of study, work, etc.; have a specialty Specialization to pursue some special line of study, work, etc.; have a specialty to be adapted to a special function or environment.

Trade Barriers any regulation or policy that restricts international trade, esp. tariffs, quotas, etc.

Fees imposed by a government on imported or exported goods Tariffs Fees imposed by a government on imported or exported goods

Quotas A proportional share, as of goods, assigned to a group or to each member of a group; an allotment.

Embargoes an order of a government prohibiting the movement of merchant ships into or out of its ports

OPEC The Organization of Petroleum Exporting Countries, which decides the price and amount of oil produced each year in Iraq, Iran, Saudi Arabia, Kuwait, Venezuela, and other countries.

Currency Exchange one party purchasing a quantity of one currency in exchange for paying a quantity of another

Human Capital refers to the stock of skills and knowledge embodied in the ability to perform labor so as to produce economic value.

Gross Domestic Product gross national product excluding payments on foreign investments Also called GDP

a Latin phrase meaning Per Head Per Capita a Latin phrase meaning Per Head It is usually used to indicate the average per person for any given concern, such as income, crime rate, etc.

Entrepreneur a person who organizes and manages any enterprise or business, usually with considerable personal initiative and risk