From Banking to Economics Flashcards
“Credit crunch”
a massive reduction in the amount of credit available for banks to lend to other banks, businesses and households
Credit rating?
estimates of people’s ability to fulfill their financial commitments
A slush fund?
Money set aside for dishonest use
Purchasing power parity (PPP)
How much you can buy for the same amount in different country
Autarky?
Impossible situation where a country is self-sufficient has no foreign trade
Balance of trade?
Balance of payments?
BOT - The difference between what a country receives and pays for importing and exporting goods
BOP - statement of all of transactions made between a country and the rest of the world during a given year
Tax avoidance vs tax evasion
Avoidance - legal way of minimizing taxes
Evasion - illegal way of minimizing taxes
Options (in stocks and shares)
Call option
Put option
Giving the right to buy and sell securities at a fixed price in the future.
Call - Gives you the right to buy securities at a certain price during a certain period of time
Put - Gives you the right to sell securities…
Standing order (in banking)
an instruction to a bank to pay fixed sums of money to certain people or organizations at stated times
Break-even point
Total costs=total income from sales. Company makes neither profit or loss
Bull market?
Bear market?
Bull - A period during which most of stocks are rising in value
Bear - …most stocks fall in value
Speculation?
To hedge?
Buying assets in the hope of making a capital gain by selling them later at a higher price.
To hedge - to attempt to protect oneself against future price changes
Leveraged buyout?
Buying a company with borrowed money.
Natural monopoly?
A market in which it is normal to have only one supplier (e.g utilities such as water, sewage, electricity)
Equilibrium?
State of balance, e.g when supply is the same as demand
Trade barriers?
Tariff? Quotas? (In international trade)
TB - government policies or regulations that restrict international trade
Tariff - a tax charged on imports
Quota - a maximum quantity of goods that be imported to a country ( of the same kind)
Gross national product (GNP)
Gross domestic product (GDP)
- The total wealth earned or created in a country in a year
- The sum of all of a country’s economic activity
Inflation?
An increase in the general level of prices and in the money supply.
