Definitions R->W Flashcards
What is the retail prices index?
A measure formerly used to calculate the rate of consumer price inflation in the UK
It is an important economic indicator that reflects changes in the prices of a basket of goods and services.
What is saving?
Income which is not spent
Saving is crucial for personal finance and can be used for investment or emergencies.
What is seasonal unemployment?
Unemployment arising in different seasons of the year, caused by factors such as the weather and the end of the Christmas shopping period
This type of unemployment is common in industries like agriculture and retail.
What are secured loans?
Loans, such as mortgage loans, secured against the value of property
These loans are less risky for banks than unsecured loans.
What are shares?
Undated financial assets sold initially by a company to raise financial capital
Shares signify ownership in a company and can be either marketable or non-marketable depending on the type of company.
What is short-run economic growth?
Growth of real output resulting from using idle resources, including labour
This occurs by taking up the slack in the economy.
What is a structural budget deficit?
The part of the budget deficit which is not affected by the economic cycle but results from structural change in the economy
It reflects long-term government policy decisions.
What is structural unemployment?
Long-term unemployment occurring when some industries are declining, even though other industries may be growing
It can also happen due to automation or when new skills are required that existing workers do not possess.
What does ‘supply side’ refer to?
Changes in the potential output of the economy, affected by available factors of production
This includes changes in the size of the labour force and productivity.
What is supply-side economics?
A branch of free-market economics arguing that government policy should be used to improve the competitiveness and efficiency of markets
This approach aims to enhance overall economic performance.
What is supply-side fiscal policy?
Used to increase the economy’s ability to produce and supply goods by creating incentives to work, save, invest, and be entrepreneurial
Interventionist policies may also include funding retraining schemes for unemployed workers.
What are supply-side improvements?
Reforms undertaken by the private sector to increase productivity and reduce costs
Often result from more investment and innovation.
What are supply-side policies?
Government economic policies aimed at making markets more competitive and efficient
They aim to shift the LRAS curve to the right and include both fiscal and non-fiscal measures.
What is systemic risk?
The risk of a breakdown of the entire financial system due to inter-linkages within the financial system
This differs from the failure of an individual bank or financial institution.
What are tariffs?
Taxes imposed on imports from other countries entering a country
Also known as import duties, they can affect trade balances.
What is total managed expenditure?
The total amount that the government spends
It includes both allocated spending by government departments and uncontrolled spending.
What is a trade-off between policy objectives?
The idea that it may be impossible to achieve two desirable objectives at the same time
For example, achieving both zero inflation and full employment may require a compromise.
What is the trend growth rate?
The rate at which output can grow, on a sustained basis, without putting upward or downward pressure on inflation
It reflects the annual average percentage increase in productive capacity.
What is the United Nations Human Development Index?
An index based on life expectancy, education, and per capita income indicators
It ranks countries into four tiers of human development.
What is a withdrawal in economic terms?
A leakage of spending power out of the circular flow of income into savings, taxation, or imports
Withdrawals can affect overall economic activity.
What is the World Trade Organization?
An international body whose purpose is to promote free trade by persuading countries to abolish import tariffs and barriers to trade
It is closely associated with the process of globalization.
