Name: 
 

ECON CH-2 VOCAB



Matching
 
 

a.
free enterprise
k.
factor payments
b.
command economy
l.
consumer sovereignty
c.
household
m.
invisible hand
d.
competition
n.
communism
e.
economic system
o.
firm
f.
communist
p.
factor market
g.
Adam Smith
q.
collective
h.
centrally planned economy
r.
incentive
i.
continuum
s.
authoritarian
j.
heavy industry
 

 1. 

the method used by a society to produce and distribute goods and services
 

 2. 

a person or group of people living in the same residence
 

 3. 

an economic system characterized by private or corporate ownership of capital goods; investments that are determined by private decision rather than by state control; and determined in a free market
 

 4. 

a range with no clear divisions
 

 5. 

the income people receive for supplying factors of production, such as land, labor, or capital
 

 6. 

an organization that uses resources to produce a product, which it then sells
 

 7. 

the struggle among producers for the dollars of consumers
 

 8. 

large farm leased from the state to groups of peasant farmers
 

 9. 

economic system in which the central government makes all decisions on the production and consumption of goods and services
 

 10. 

the father of modern Capitalism
 

 11. 

industry that requires a large capital investment and that produces items used in other industries
 

 12. 

The term was adopted by the Bolsheviks
 

 13. 

the power of consumers to decide what gets produced
 

 14. 

requiring strict obedience to an authority, such as a dictator
 

 15. 

an expectation that encourages people to behave in a certain way
 

 16. 

market in which firms purchase the factors of production from households
 

 17. 

a political system characterized by a centrally planned economy with all economic and political power resting in the hands of the central government
 

 18. 

term economists use to describe the self regulating nature of the marketplace
 

 19. 

economic system in which a central authority is in command of the economy; a centrally planned economy
 
 
a.
transition
j.
specialization
b.
safety net
k.
mixed economy
c.
market
l.
privatize
d.
Vladimir Lenin
m.
standard of living
e.
private property
n.
profit
f.
socialism
o.
laissez faire
g.
market economy
p.
traditional economy
h.
self-interest
q.
Karl Marx and Friedrich Engels
i.
patriotism
r.
product market
 

 20. 

the concentration of the productive efforts of individuals and firms on a limited number of activities
 

 21. 

introduced their socialist philosophy in The Communist Manifesto in 1848
 

 22. 

government programs that protect people experiencing unfavorable economic conditions
 

 23. 

level of economic prosperity
 

 24. 

took control of Russia in 1917
 

 25. 

the doctrine that states that government generally should not intervene in the marketplace
 

 26. 

the market in which households purchase the goods and services that firms produce
 

 27. 

economic system that relies on habit, custom, or ritual to decide questions of production and consumption of goods and services
 

 28. 

an arrangement that allows buyers and sellers to exchange things
 

 29. 

to sell state-run firms to individuals
 

 30. 

period of change in which an economy moves away from a centrally planned economy toward a market-based system
 

 31. 

economic system in which decisions on production and consumption of goods and services are based on voluntary exchange in markets
 

 32. 

the love of one’s country; the passion that inspires a person to serve his or her country
 

 33. 

market-based economic system with limited government involvement
 

 34. 

the financial gain made in a transaction
 

 35. 

a social and political philosophy based on the belief that democratic means should be used to evenly distribute wealth throughout a society
 

 36. 

property owned by individuals or companies, not by the government or the people as a whole
 

 37. 

one’s own personal gain
 



 
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