Glossary Terms:

Henry Ford and the Model T: A Case Study in Productivity (Part 1)

Glossary terms from:
http://www.econedlink.org/e668


Capital

Resources and goods made and used to produce other goods and services. Examples include buildings, machinery, tools and equipment. In the context of credit transactions, capital is one of the Three Cs of Credit. It is an indicator of how creditworthy a prospective borrower is likely to be as determined by the borrower's current financial assets and net worth.

Capital Resources

Resources made and used to produce and distribute goods and services; examples include tools, machinery and buildings.

Choice

Decision made or course of action taken when faced with a set of alternatives.

Credit

The opportunity to borrow money or to receive goods or services in return for a promise to pay later.

Demand

The quantity of a good or service that buyers are willing and able to buy at all possible prices during a period of time.

Division of Labor

An arrangement in which workers perform only one step or a few steps in a larger production process (as when working on an assembly line).

Economic Incentives

Factors that motivate and influence the behavior of individuals and organizations, including firms and government agencies. Prices, profits and losses are important economic incentives in a market economy.

Economics

The study of how people, firms and societies choose to allocate scarce resources with alternative uses.

Entrepreneur

One who draws upon his or her skills and initiative to launch a new business venture with the aim of making a profit. Often a risk-taker, inclined to see opportunity when others do not.

Goods

Tangible objects that satisfy economic wants.

Investment

The purchase of capital goods (including machinery, technology or new buildings) that are used to produce goods and services. In personal finance, the amount of money invested in stocks, bonds, mutual funds and other investment instruments.

Job

A piece of work usually done on order at an agreed-upon rate. Also a paid position of regular employment.

Labor

The quantity and quality of human effort available to produce goods and services.

Natural Resources

"Gifts of nature" that can be used to produce goods and services; for example, oceans, air, mineral deposits, virgin forests and actual fields of land. When investments are made to improve fields of land or other natural resources, those resources become, in part, capital resources. Also known as land.

Non-price Determinants

Non-price determinants can be interactions that do not affect the price of the wide range of supply and demand factors.

Price

The amount of money that people pay when they buy a good or service; the amount they receive when they sell a good or service.

Product

A good or service that can be used to satisfy a want.

Production

A process of manufacturing, growing, designing, or otherwise using productive resources to create goods or services used to to satisfy a want.

Productive Resources

Natural resources, human resources, capital resources and entrepreneurship used to make goods and services.

Productivity

The amount of output (goods and services) produced per unit of input (productive resources) used.

Resources

The basic kinds of resources used to produce goods and services: land or natural resources, human resources (including labor and entrepreneurship), and capital.

Sale

An exchange of goods or services for money.

Services

Activities performed by people, firms or government agencies to satisfy economic wants.

Specialization

A situation in which people produce a narrower range of goods and services than they consume. Specialization increases productivity; it also requires trade and increases interdependence.

Stock

An ownership share or shares of ownership in a corporation.

Supply

The amount of a good or service that producers are willing and able to offer for sale at each possible price during a given period of time.

Work

Effort applied to achieve a purpose or result, often for pay; skills and knowledge put to use to get something done; employment at a job or in a position; occupation, profession, business, trade, craft, etc.

Workers

People employed to do work, producing goods and services.