Economic Institutions — Flashcards

Answer

An economic institution refers to socially sanctioned structures and norms that govern the production, distribution, and consumption of goods and services. These institutions help meet basic human nee…

Answer

Economic institutions perform three main functions: (1) organizing production of goods and services, (2) managing their distribution, and (3) regulating consumption. They ensure that resources are use…

Answer

Property refers to anything with economic value such as land, factories, or goods. It includes both private property (owned by individuals) and public property (controlled by the government). Property…

Answer

Kingsley Davis identified four characteristics of property: (1) It can be transferred from one person to another. (2) The owner may not be the user. (3) It is a concrete external object. (4) It gives …

Answer

A contract is a formal agreement between two or more parties to perform certain actions for a specific purpose and duration. It defines rights and obligations clearly. Examples include employment cont…

Answer

Contractual relationships are: (1) impersonal — based on roles, not emotions; (2) limited to formal terms; (3) time-bound and specific in scope; (4) rational and goal-oriented. For example, an employe…

Answer

Property deals with ownership of resources like land or capital, while contract governs agreements between people regarding exchange or work. Property establishes who controls resources; contracts def…

Answer

The three types of production are: (1) Primary — extracting raw materials (e.g., farming, mining); (2) Secondary — manufacturing goods from raw materials (e.g., making cars or clothes); (3) Tertiary —…