Q&A >

Markets

Economics is the science of production and trade under a division of labor (market) society.

Economics

Economics is the science of production and trade under a division of labor (market) society.

Economic Actor

The economic actor — the entity that performs all economic decisions and actions — is the individual.

Economic Value

The economic value of a good or service is what an individual would exchange for a given good or service.

Production

Production is the act of creating — shaping materials into values –– goods and services for future consumption.

Consumption

Consumption is the act of consuming or using (up) values.

Wealth

Wealth is a material good or service that has value to human life (that has economic value.)

Division of Labor

In a division of labor society, individuals create values for future trade as opposed to self-consumption.

Trade

Trade is the act of voluntarily exchanging one value for another. (Theft is when the value is exchanged involuntarily).

Prices

The price of a good or service are the values it is exchanged for.

Money

Money is an asset used in a division of labor society as a medium for indirect exchange.

Free-Market

A free-market is a market free from the intiation of physical force, where all exchanges are voluntary.

Business Enterprise

A business (enterprise) is an organization that creates products/services to sell on the market with the goal of making a profit for its owners.

Profit and Loss

A business makes a financial profit/loss when its revenues are more/less than its costs.

Savings

Savings is wealth that is not consumed.

Capitals

Capital is savings from production reinvested in an industry to produce wealth.

Entrepreneur

A capitalist (or entrepreneur) invests (and risks) capital in a business concern in the hopes of earning a profit in the future.

Interest

Interest is the premium on a loan, that is added to the principal when the loan is due.

Profits

A profit is made by creating something of economic value that is more than the cost of producing it.

Say’s Law of Markets

Say’s Law of Markets is the principle that supply constitutes demand. In Jean-Baptiste Say’s words: “products are paid for with products.”

Voice of Capitalism

Our free weekly email newsletter.

You have Successfully Subscribed!

Pin It on Pinterest