1. EQ: How do consumers and businesses interact in the United States economy?

2. Market economy
Citizens own the businesses in the economy, not the govt. People can choose what they want to buy

3. Markets
Place where a nation can sell its goods

4. People buy groceries, cars, computers, clothes, houses, and other items in a market. Goods and services are everything bought and sold in a market.

5. Entrepreneur
Person who organizes a new business to produce goods and services for profit

6. Entrepreneurs take financial risks by spending their own money (or borrowed money) to start new businesses that they believe will eventually earn profits.

7. EQ: How do incentives and competition affect people’s economic decisions?

8. Income
Money earned through employment and investments

9. Businesses pay workers income for their labor
Businesses pay workers income for their labor. Workers then spend part of their income in the market as consumers. The more they spend, the better businesses do.

10. Incentive
Benefit given to encourage a person to buy (or produce) a good or service

11. Low prices are an incentive to buy
Low prices are an incentive to buy. High prices are an incentive to produce and sell. Coupons are incentives to purchase a specific product.

12. Competition
The battle for your business between the sellers of a good or service

13. Since consumers are free to buy from whatever producer they want, producers have to compete to convince customers to buy from them. Price and quality are two main areas where producers compete.