Key Vocabulary in Capitalism

Here's a list of key terms associated with capitalism:

Core Concepts

• Capitalism: An economic system characterized by private ownership of the means of production and operation for profit.
• Free Market: An economic system in which prices are determined by supply and demand, with little or no government intervention.
• Laissez-faire: An economic system where the government has minimal intervention in economic affairs.
• Supply and Demand: The economic principle that determines the price of goods and services.
• Profit Motive: The desire to earn profits, which drives economic activity in a capitalist system.

Key Players

• Entrepreneur: An individual who organizes and manages a business enterprise, taking on financial risks to do so.
• Investor: A person who provides capital to a business in exchange for a share of ownership or a return on investment.
• Consumer: An individual who purchases goods and services for personal use.
• Producer: An individual or organization that creates goods or services.

Economic Indicators

• Gross Domestic Product (GDP): The total value of goods and services produced within a country's borders in a specific period.
  
• Inflation: A general increase in prices over time.
• Deflation: A general decrease in prices over time.
• Unemployment Rate: The percentage of the labor force that is unemployed.

Economic Policies

• Monetary Policy: Government policies that control the supply of money and interest rates.
• Fiscal Policy: Government policies that influence the economy through taxation and spending.

Related Terms

• Capital: Wealth in the form of money or other assets owned by an individual or organization.
• Labor: The work and effort expended to produce goods and services.
• Market Economy: An economy based on the interaction of supply and demand.
• Command Economy: An economy where the government controls the production and distribution of goods and services.

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