Key Terms In Economy Flashcards
Bond
Long term debt instrument
Long term debt instrument
Bond
Capital gain
Positive difference between the sale price of an asset and its purchase price
Positive difference between the sale price of an asset and its purchase price
Capital gain
Consumer Price Index (CPI)
Weighted average of the prices of a representative market basket of goods and services that represents consumption patterns in some base time period
Weighted average of the prices of a representative market basket of goods and services that represents consumption patterns in some base time period
Consumer Price Index (CPI)
Deflation
Decrease in the general price level, that is, in the nominal cost of goods and services
Decrease in the general price level, that is, in the nominal cost of goods and services
Deflation
Economics
The study of how humans make choices under conditions of scarcity
The study of how humans make choices under conditions of scarcity
Economics
Economic crises + an example
Period of economic slowdown characterised by declining productivity and devaluing of financial institutions often due to reckless and unsustainable Money lending (ex: the Great Recession “housing bubble” in 2007-2009)
Period of economic slowdown characterised by declining productivity and devaluing of financial institutions often due to reckless and unsustainable Money lending (ex: the Great Recession “housing bubble” in 2007-2009)
Economic crises
Fiscal Policy
Government policy that attempts to influence the direction of the economy through changes in government spending or taxes
Government policy that attempts to influence the direction of the economy through changes in government spending or taxes
Fiscal policy
Globalisation
The trend in which buying and selling in markets have increasingly crossed national borders
The trend in which buying and selling in markets have increasingly crossed national borders
Globalisation
Great Depression
The period from 1929-1933 when there was a prolonged and steep decline in aggregate output and substantial increase in the unemployment rate
The period from 1929-1933 when there was a prolonged and steep decline in aggregate output and substantial increase in the unemployment rate
The Great Depression
The Great Recession
The period from late 2007- early 2009 when aggregate output declined and unemployment approached 10% due to a large financial disruption
The period from late 2007- early 2009 when aggregate output declined and unemployment approached 10% due to a large financial disruption
Great Recession
Gross domestic product (GDP)
The market value of all officially recognised final goods and services produced within a country in a given period of time
The market value of all officially recognised final goods and services produced within a country in a given period of time
Gross Domestic Product (GDP)
Inflation
Increase in the general level of prices or in the cost of living
Increase in the general level of prices or in the cost of living
Inflation
Macroeconomics
Study of the performance, structure, behaviour and decision-making of an economy as a whole, rather than individual markets
Study of the performance, structure, behaviour and decision-making of an economy as a whole, rather than individual markets
Macroeconomics
Market economy
Economy in which goods and services are exchanged in a free market, as opposed to a state controlled or socialist economy; a capitalist economy
Economy in which goods and services are exchanged in a free market, as opposed to a state controlled or socialist economy; a capitalist economy
Market economy
Microeconomics
Study of economy on small-scale activities such as that of the individual or company
Study of economy on small-scale activities such as that of the individual or company
Microeconomics
Monetary policy
Process by which the central bank, or monetary authority manages the supply of money, or trading in foreign exchange markets
Process by which the central bank, or monetary authority manages the supply of money, or trading in foreign exchange markets
Monetary policy
Monopoly
A market where one company is the sole supplier
A market where one company is the sole supplier
Monopoly
National debt
The accumulation of deficits (government spending in excess of tax revenue collected) over time
The accumulation of deficits (government spending in excess of tax revenue collected) over time
National debt
National income
The sum of all types of income (wages, net interest, profits, and net rental income) earned in a given time period by any type of economic agent
The sum of all types of income (wages, net interest, profits, and net rental income) earned in a given time period by any type of economic agent
National income
Quantitative easing
A relatively new monetary policy tool used by the Federal Reserve System when other traditional tools become ineffective. Refers to the purchase of other assets to inject liquidity into the economy
A relatively new monetary policy tool used by the Federal Reserve System when other traditional tools become ineffective. Refers to the purchase of other assets to inject liquidity into the economy
Quantitative easing
Recession
Period of reduced economic activity
Period of reduced economic activity
Recession
Spread
The difference between two prices, rates or yields
The difference between two prices, rates or yields
Spread
Sub-prime
Designating a loan (typically at a greater than usual rate of interest) offered to a borrower who is not qualified for other loans (for example because of poor credit history)
Designating a loan (typically at a greater than usual rate of interest) offered to a borrower who is not qualified for other loans (for example because of poor credit history)
Sub-prime
Welfare economics
Branch of economics that seeks to evaluate economic policies in terms of their effects on the wellbeing of the community
Branch of economics that seeks to evaluate economic policies in terms of their effects on the wellbeing of the community
Welfare economics
