Capitalism

Generally speaking,capitalism is the system where capital(the companies, equipment and structures used for producing goods and service) is owned not by the state but by private indyviduals.But most of the books dont even bother to define it.Its a mulit-dimensional system unlike the communism.Capitalism as a MONGREL.
It has been criticized many times for exploiting the employees and is prone to the formation of monopolies.
The capitalism have never existed in its purest, fully free economy form-often called Laissez-Faire, from the french for ''let them do''.In fact ,most leading nations are actually slightly less free market than they were free centuries ago.In 1929 shortly before The Wall Street Crash , US goverment spending accounted for less than one-tenth of the country`s economic output. Forty years later it accounted for around one-third. Today, it accounts for around 36 per cent, with the proportion fast to rise.Although it is not the same system as at the beggining, Capitalism still is considered as one of the best economics idea.Or The least worst way to run an economy.
It is linked with democracy.In fact it is inherently democratic. There is no Capitalism without democracy and its belived that China`s adaptation of free market values will lead it toward Democracy.
After the collapse of Communism in Europe, new countries adopted Capitalism as its main economic idea. Even for its critics it should be obvious by looking at the countries which had been under Communist influence for the last 50 years, that Capitalism had left western economies in a far better shape than the previous members of the Eastern Block.Amen

Comparative Advantage

This economics idea says that everyone should focus on producing only one good he is best at,  in spite of the fact that he could be pretty good at producing both of them.Im means that is one country produces 50 000 bottles of wine a year and 10 000 jeans a year, it would be better for it to use all the labour and time only for producing wine. Its much more efficient and they can sell/exchange the production surplus in a free market

Division of Labour

Its an idea of dividing up the work and specializing in what each of us is good at.Its has been practised for millennia until it reached its culmination in 20th century in the shape of Henry Ford and his famous Model-T car
Division of Labour allows us to produce things faster and at the smaller cost.Each element is made separately by a specialist and then merged into an expected shape/object. Nowadays different elements can be made in different countries or even different continents and then be brought to the factory. Its is one of the most important and powerful pieces of economic logic.
There are also some cons of it. The first is that , it can be extremely difficult to find a job when you specialize in a craft that is no longer in use. Second, a factory can become entirely dependent on one person or a group of people.If someone doesn`t do its duty properly the whole factory stops producing.We can say that chain is as strong as its weakest link...Third, it can undermine the morale of an individual to be forced to specialize only in one specific job, i.e pressing the red button. Despite all of these threats, Division of Labour remains the fundament of modern economics and remains the key to the effectivness of production

Incentives

In economics and sociology, an incentive is any factor (financial or non-financial) that enables or motivates a particular course of action, or counts as a reason for preferring one choice to the alternatives. It is an expectation that encourages people to behave in a certain way.

Opportunity Cost=Time is Money

its the alternative use of your cash and time.it means for that every hour we spend at one job we could spend differently doing something else(i.e watching tv or sleeping). Basically opportunity cost applies to all aspects of our lives whenever we need to make a decision involving our time, money, labout etc.If a second choice turned out to be a better one that the one we have chosen-we call it forgone opportunity.It is a major issue in business since you need to know which decisions are more profitable.I.e the owner of the farm have 100.000€ to spend.He can either buy more advanced fertilizers in his hope for a better harvest next year. He could also put the money into a bank account where it could earn 5 per cent interest a year. Therefore the opportunity cost of the investment is 5000 €-the amount forgone by investing in the fertilizers.

The Malthusian Trap

Thomas Robert Malthus said is his 1798 ''Essay on the Principle of Population, that human population is raising geometrically(i.e by multiples-2,4,8,16...) while the food production grows arithmetically(i.e by addition-2,4,6,8...). According to him humanity was heading for an evitable crunch. Unless we will cut our birth rate, the human population will suffer one of the three checks imposed by nature to keep it at certain sustainable limits: famine, disease or war .
According to Malthus critics,  he was wrong. The population of the earth grew from 980 milion in 18th  century to 6,5 bilion in 21st century.It is projected to Baloon to more than 9 bilion by 2050. Yet the majority of people on the planet are better fed, more healthy and longer-lived than ever before. This is mainly because humans have tendency to improve technology all the time, giving us more advanced and efficient agriculture every year.At the same time rich societes(so called Western World) tend to have less children, with birth rate insufficient to prevent depopulation. On the other hand Neo-Malthusians say that we have only managed to delay the catastrophe for a couple of centuries. Even though Malthus concerns were focused on food problems, one could just as easily insert oil and energy sources as being the chief''means of man support'' We are at the eve of another crunch and if we are going to be saved by technological advance or population restraint remains to be seen

http://www.uswitch.com/news/money/uk-worst-place-to-live-in-europe-uswitch-quality-of-life-index-890419/

The law of supply and demand

Supply and demand is an economic model of prize determination in the market. It says that in the competitive market prize of the particular good will vary until it reaches prize EQUILIBRIUM, which is the point where quanity supplied by the producers equals the quantity demanded by the consumers.
It means that the product prize is an index showing us whether the supply or demand for this particular product is rising or falling.

Adam`s Smith invisible hand(of the market)

The invisible hand of the market is a metaphor used by Adam Smith in his book Inquiry into the Nature and Causes of the Wealth of Nations (1776).  Smith tried to describe the mechanism characteristic of capitalist economies, and in the sense that the actions of individuals, due to their selfish desire to satisfy their own needs, in fact also contribute to the realization of social needs. According to Smith the market mechanism is able to regulate the process of meeting social needs and therefore rejects the need for state intervention and protectionism, as conditions for the realization of public interest.