Section 5.2 Vocabulary - The Market Economy

the way goods and services are produced and consumed

• economy

• market

• consumer

• producer

someone who acquires goods and services for his or her own personal use

• economy

• market

• consumer

• producer

someone who makes goods or offers services to others

• economy

• market

• consumer

• producer

refers to the entire activity of buying and selling that places out in the world

• economy

• market

• consumer

• producer

financial gain received by selling something for more than it cost to make it

• profit

• incentive

• innovation

• competition

idea that consumers will want or need what producers are offering

• profit

• incentive

• innovation

• competition

producers battle over who can make the most profit

• economy

• incentive

• innovation

• competition

process of developing new, better things

• economy

• incentive

• innovation

• competition

the amount of something that is available

• market forces

• supply

• demand

• opportunity cost

• scarcity

the number of consumers who want something

• market forces

• supply

• demand

• opportunity cost

• scarcity