Key term definitions 2.5

Question 1

what is the definition of appreciation of a currency?

Answer 1

a rise in the value of a currency

Question 2

what is the definition of base rate?

Answer 2

the rate of interest around which a bank structures other interest rates

Question 3

what is the definition of boom?

Answer 3

t of the economic cycle where GDP is growing at its fastest

Question 4

what is the definition of consumer price index (CPI)?

Answer 4

a common measure of price changes used in he EU

Question 5

what is the definition of deflation?

Answer 5

a fall in the general price level. also used to describe a situation where economic growth is falling or negative when inflation is falling

Question 6

what is the definition of depreciation (of a currency)?

Answer 6

a fall in the value of a currency

Question 7

what is the definition of downturn?

Answer 7

a period in the economic cycle where GDP grows but more slowly

Question 8

what is the definition of economic, trade or business cycle?

Answer 8

regular fluctuations in the level of output in the economy

Question 9

what is the definition of the exchange rate?

Answer 9

the price of 1 currency in terms of another

Question 10

what is the definition of fiscal policy?

Answer 10

using changes in taxation and government expenditure to manage the economy

Question 11

what is the definition of government expenditure?

Answer 11

the amount spent by the government in its provision of public services

Question 12

what is the definition of Groos Domestic Product (GDP)?

Answer 12

a common measure of national income, output or employment

Question 13

what is the definition of index linked?

Answer 13

the linking of certain payments such as benefits to the rate of inflation

Question 14

what is the definition of inflation?

Answer 14

a general rise in prices

Question 15

what is the definition of monetary policy?

Answer 15

using changes in the interest rate and money supply to manage the economy

Question 16

what is the definition of a recession?

Answer 16

a less severe form of depression

Question 17

what is the definition of recover or upswing?

Answer 17

a period where economic growth begins to increase again after a recession

Question 18

what is the definition of slump or depression?

Answer 18

the bottom of the economic cycle where GDP starts to fall with significant increases in unemployment

Question 19

what is the definition of taxation?

Answer 19

the charges made by the government on the activities, earnings, and income of businesses and individuals

Question 20

what are anti-competitive/restrictive practices?

Answer 20

attempts by firms to prevent or restrict competition

Question 21

what are barriers to entry?

Answer 21

obstacles that make it difficult for new firms to enter a new market

Question 22

what is collusion?

Answer 22

in business where several businesses make agreements among themselves which benefit them at the expense of either rival businesses or customers

Question 23

what is the contract of employment?

Answer 23

a written agreement between an employer and an employee in which each has certain obligations

Question 24

what is discrimination?

Answer 24

favouring one person over another. In the EU it’s unlawful to discriminate on grounds regarding the protective strands

Question 25

what is an employment tribunal?

Answer 25

a court that deals with cases involving disputes between employers and employees

Question 26

what is the national minimum wage?

Answer 26

a wage rate set by the government below which it’s illegal to pay people at work

Question 27

what is unfair dismissal?

Answer 27

the illegal dismissal of a worker by a business

Question 28

which is a cartel?

Answer 28

a group of businesses which join together to agree on pricing and output in a market in an attempt to gain higher profits at the expense of customers

Question 29

what bare market structures?

Answer 29

characteristics of a market e.g. size of a barrier to entry, number of businesses. they determine the behaviour of businesses within the market