External influences on business activity Flashcards
Balance of payments
The difference between the values of export and import goods and services of a country over a year
Inflation
The price increase of goods and services over time
Level of unemployment
The proportion/percentage of population that are capable of working but unable to find a job
Gross domestic product (GDP)
The value of all goods and services produced by a country in a year
Growth
This stage is when the economy recovers or grows
Boom
This stage is the peak of a business cycle
Recession
This is when the economy shrinks in size
Slump
This is when the recession stage of the economy is at its worst
Interest rate
The cost to a person or business of borrowing money from a lender such as a bank
Tax
A charge/fee paid to the government on income, goods and services
Direct tax
The tax charged on personal income or tax on the profit made by a business
Indirect tax
The tax charged on the price of goods and services, which is added to the price of goods and services before they are bought
Disposable income
The amount of income left for individuals after taxes have been paid
Externality
The effect of business activities on unrelated parties
Social cost
The negative impact of a business decision on society
