Economic Vocab

Question 1

Austerity

Answer 1

Economic policy aimed at reducing a government’s deficit (or borrowing). Austerity can be achieved through increases in government revenues - primarily via tax rises - and/or a reduction in government spending or future spending commitments

Question 2

Balance of Trade

Answer 2

The difference between the value of a country’s exports and imports of goods and services produced.

Question 3

Aid

Answer 3

Transfer of resources on concessional terms (often IR lower than market rates)