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Economics > Subject Vocabulary > Flashcards

Subject Vocabulary Flashcards

1
Q

External economies of scale

A

cost benefits that all firms in an industry can enjoy when the industry expands

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2
Q

Bulk buying

A

buying goods in large quantities, which is usually cheaper than buying in small quantities

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3
Q

Internal economies of scale

A

cost benefits that an individual firm can enjoy when it expands

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4
Q

Diseconomies of scale

A

rising average costs when a firm becomes too big

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5
Q

Economies of scale

A

falling average costs due to expansion

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6
Q

Scale

A

size of a business

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7
Q

Total cost

A

fixed costs and variable costs added together

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8
Q

Variable costs

A

costs that change when output levels change

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9
Q

Costs

A

expenses that must be met when setting up and running a business

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10
Q

Fixed costs (overheads)

A

costs that do not vary with the level of output

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11
Q

Division of labour

A

breaking down of the production process into small parts with each worker allocated to a specific task

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12
Q

Specialisation

A

production of a limited range of goods by individuals, firms, regions or countries

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13
Q

Job rotation

A

practice of regularly changing the person who does a particular job

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14
Q

Piece rate

A

amount of money that is paid for each item a worker produces, rather than for the time taken to make it

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15
Q

Productivity

A

rate at which goods are produced, and the amount produced in relation to the work, time and money needed to produce them

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16
Q

Assembly plants

A

factory where parts are put together to make a final product

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17
Q

Secondary sector/industry

A

production involving the processing of raw materials into finished and semi-finished goods

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18
Q

Tertiary sector/industry

A

production of services in the economy

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19
Q

De-industrialization

A

decline in manufacturing

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20
Q

Primary sector/industry

A

production involving the extraction of raw materials from the earth

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21
Q

Capital intensive

A

production that relies more havily on machinery relative to labour

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22
Q

Labour intensive

A

production that relies more heavily on labour relative to machinery

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23
Q

Fixed capital

A

stock of ‘man-made’ resources, such as machines and tools, used to help make goods and services

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24
Q

Entrepreneurs

A

individuals who organise the other factors of production and risk their own money in a business venture

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25
Q

Human capital

A

value of the workforce or an individual worker

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26
Q

Labour

A

people used on production

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27
Q

Working capital or circulating capital

A

resources used up in production such as raw materials and components

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28
Q

Factors of production

A

resources used to produce goods and services which include land, labour, capital and enterprise

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29
Q

Production

A

process that involves converting resources into goods or services

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30
Q

Pollution permit

A

government issued document that gives a business the right to discharge a certain quantity of a polluting material into the enviroment

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31
Q

Private benefits

A

benefits received by those directly consuming or producing a product or service

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32
Q

Social benefits

A

benefits of an economic activity to society as well as to the individual or firm

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33
Q

Social costs

A

costs of an economic activity to society as well as the individual or firm

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34
Q

Private costs

A

costs of an economic activity to individuals and firms

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35
Q

External benefits

A

positive spillover effects of consumption or production - they bring benefits to third parties

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36
Q

External costs

A

negative spillover effects of consumption or production - they affect third parties in a negative way

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37
Q

Spillover effects

A

effect that one situation or problem has on another situation

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38
Q

Diversified

A

if a company or economy diversifies, it increase the range of goods or services it produces

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39
Q

Hostile takeover

A

takeover that the company being taken over does not want or agree to

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40
Q

Takeovers

A

act of getting control of a company by buying over 50 percent of its shares

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41
Q

Nationalised industries

A

public corporations previously part of the private sector that were taken into state ownership

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42
Q

Natural monopolies

A

situation that occurs when one firm in an industry can serve the entire market at ta lower cost than would be possible if the industry were composed of many smaller firms

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43
Q

Monopolies

A

situation where a business activity is controlled by only one company or by the government, and other companies do not compete with it

44
Q

Privatisation

A

act of selling a company or activity controlled by the government to private investors

45
Q

Free rider

A

individual who enojoys the benefit of a good but allows others to pay for it

46
Q

Merit goods

A

goods that are under-provided by the private sector

47
Q

Public goods

A

goods that are not likely to be provided by the private sector

48
Q

Market failure

A

where markets lead to inefficiency

49
Q

Mixed economy

A

economy where goods and services are provided by both the private and the public sectors

50
Q

Assets

A

things or resources belonging to an individual or a business that has value or the power to earn money

51
Q

Liabilities

A

amount of debt that is owed or must be paid

52
Q

Dividend

A

part of a company’s profit that is divided among the people with shares in the company

53
Q

Shareholders

A

people or organisations that owns shares in a company

54
Q

Economy

A

system that attempts to solve the basic economic problem

55
Q

Private sector

A

provision of goods and services by businesses that are owned by individuals or groups of individuals

56
Q

Public sector

A

government organisations that provide goods and services in the economy

57
Q

Exise duty

A

government tax on certain goods, such as cigarettes alcoholic drinks and petrol that are sold in the country

58
Q

VAT (value added tax)

A

tax on some goods and services - businesses pay value added tax on most goods and services they buy and if they are VAT registered, charge value added tax on the goods and services they sell

59
Q

Discretionary expenditure

A

non-essential spending or spending that is not automatic

60
Q

Income elasticity of demand

A

responsiveness of demand to a change in income

61
Q

Raw materials

A

substances used to make a product

62
Q

Wholesalers

A

person or companh that sells goods in large quantities to businesses, rather than to the general public

63
Q

Price elasticity of supply

A

responsiveness of supply to a change in price

64
Q

Fast-moving consumer good (FMCG)

A

goods, especially food, that sell very quickly and in large amounts

65
Q

Price elasticity of demand

A

the responsiveness of demand to a change in price

66
Q

Excess supply

A

where supply is greater than demand and there are unsold goods in the market

67
Q

Excess demand

A

where demand is greater than supply and there are shortages in the market

68
Q

Total revenue

A

amount of money generated from the sale of goods calculated by multiplying price by quantity

69
Q

Market clearing price

A

price at which the amount supplied in a market matches exactly the amount demanded

70
Q

Equilibrium price

A

price at which supply and demand are equal

71
Q

Consumption

A

amount of goods, services, energy or natural materials used in a particular period of time

72
Q

Subsidy

A

money that is paid by a government or organisation to make prices lower, reduce the cost of producing goods or providing a service, usually to encourage production of a certain good

73
Q

Indirect taxes

A

taxes levied on spending, such as VAT

74
Q

Productivity

A

rate at which goods are produced and the amount produced in relation to the work, time and money needed to produce them

75
Q

Ventures

A

new business activities or projects that involve taking risks

76
Q

Shift in the supply curve

A

movement to the left or right of the entire supply curve when there is any change in the conditions of supply except the price

77
Q

Proportionate relationship

A

(between price and quantity supplied) when the price goes up, the quantity supplied also goes up and when the price goes downn the quantity supplied goes down

78
Q

Supply

A

amount that producers are willing to offer for sale at different prices in a given period of time

79
Q

Supply curve

A

line drawn on a graph which shows how much of a good sellers are willing to supply at different prices

80
Q

Substitute goods

A

goods bought as an alternative to another but perform the same function

81
Q

Complementary goods

A

goods purchased together because they are consumed together

82
Q

Infrastructure

A

basic systems and structures that a country needs to make economic activity possible, for example, transport, communication and power supplies

83
Q

Disposable income

A

income that is available to someone over a period of time to spend; it includes state benefits but excludes direct taxes

84
Q

Inferior goods

A

goods for which demand will fall if income rises or rise if income falls

85
Q

Normal goods

A

goods for which demad will increase if income increases or fall if income falls

86
Q

Shift in the demand curve

A

movement to the left or right of the entire demand curve when there is a change in any factor affecting demand except the price

87
Q

Demand curve

A

line drawn on a graph that shows how much of a good will be bought at different prices

88
Q

Demand schedule

A

table of the quantity demanded of a good at different price levels - can be used to calculate the expected quantity demanded

89
Q

Effective demand

A

amount of a good people are willing to buy at given prices over a given period of time supported by the ability to pay

90
Q

Inverse relationship

A

(between price and quantity demanded) when price goes up, the quantity demanded falls and when the price goes down the quantity demanded rises

91
Q

Administration

A

activities involved with managing and organising the work of a company or organisation

92
Q

Enterprises

A

companies, organisations or businesses

93
Q

Maximise

A

to increase something such as profit, satisfaction or income as much as possible

94
Q

Revenue

A

money that a business receives over a period of time, especially from selling goods or services

95
Q

Variables

A

something that affects a situation in a way that means you cannot be sure what will happen

96
Q

Economic growth

A

increase in the level output by a nation

97
Q

Capital goods

A

those purchased by firms and used to produce other goods such as factories machinery, tools and equipment

98
Q

Consumer goods

A

those purchased by households such as food, confectionery, cars, tablets and furniture

99
Q

Production possibility curve (PPC)

A

line that shows the different combinations of two goods an economy can produce if all resources are used up

100
Q

Opportunity cost

A

cost of the next best alternative given up (when making a choice)

101
Q

Expenditure

A

spending by a government, susually a national government

102
Q

Basic economic problem

A

allocation of a nation’s scarce resources between competing uses that represent infinite wants

103
Q

Scarce resources

A

amount of resources avilable when supply is limited

104
Q

Finite

A

having an end or a limit

105
Q

Infinite

A

without limits

Economics (11 decks)

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