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1. Macroeconomics looks at the operation of a nation's economy as a whole, and microeconomics looks at the behavior of people and organizations in particular markets.
2. Thomas Carlyle called economics the "dismal science" in response to Thomas Malthus' argument that there would soon be too many people in the world and not enough food and other resources.
3. Teaching a man to start a fish farm is better than teaching him to fish.
4. Adam Smith's term invisible hand describes the process that turns self-directed gain into social and economic benefits for all. The invisible hand creates wealth for a country by providing ample food and creating jobs.

p. 47

1. The four basic rights that people have under free market capitalism are private property, business ownership/profits, freedom of competition, and freedom of choice.
2. Businesspeople know what to produce and in what quantity by researching the market: that is, what people choose to buy or not buy.
3. In a free market economy, prices are determined by buyers and sellers negotiating in the marketplace: that is, by supply and demand.
4. A free market's limitations include inequality in terms of money, wealth, talent, and drive.

p. 50

1. The limitations of capitalism led to the emergence of socialism.
2. Socialism's benefits include social equality, and its drawbacks include disincentives.
3. Counties that still practice communism include Cuba and North Korea.
4. The characteristics of a mixed economy include private ownership of land and business with government regulation.

p. 59

1. GDP, unemployment, and CPI are three economic indicators. During the early 2000s in the U.S., GDP was about $10 trillion. In 2002-3, the U.S. unemployment rate was about 6%. In August, 2003, the CPI for all items in an average U.S. city was + 0.4%.
2. A recession is two or more consecutive quarters of decline in GDP, and a depression is a severe recession.
3. The government manages the economy using fiscal policy by increasing (decreasing) taxes and/or government spending.
4. Monetary policy is the management of the money supply and interest rates, which is the responsibility of the Federal Reserve System.