Term 3: Glossary Words Flashcards
what is aggregate demand?
sum or total value of all spending/demand on final (finished) goods and services produced by a nation and measured over a period of time
what is balance of trade?
difference between value of a country’s exports and value of its imports over a specific period of time
formula:
value of exports - value of imports
what is a bilateral agreement?
agreement between two nations
what are bonds?
a loan to a company/government that pays investors a fixed rate of interest
what is a budget?
list of income and likely expenditures
what is budgetary policy?
macroeconomic or aggregate demand management strategy involving government’s estimates of expected value of its receipts + expected value of its outlays
what is cash rate?
official price of borrowing money; interest rate that applies to the short-term money market
what does it mean to be a consumer?
to purchase goods and services for direct use or ownership
what is cost inflation?
sustained increase in price of goods and services caused by producers passing on increased production costs to consumers
what is demand inflation?
price increases that result from excess of demand over supply for economy as a whole
what is deregulation?
removal of unnecessary direct government controls, restrictions, and supervision in various areas of the economy
what is economic growth?
measurement of the increase in a country’s gross domestic product (GDP)
what is an economy?
all activities undertaken for purpose of production, distribution, and consumption of goods and services in a region or country
what are exports?
goods and services sold by local businesses to overseas consumers
what is fiscal policy?
use of the federal government’s budget to achieve economic objectives
what is free trade?
no artificial barriers to trade between nations
what is gross domestic product (GDP)?
total value of all goods and services produced in a country in given period of time (usually a year)
what are imports?
goods and services purchased by local consumers from overseas businesses
what is income?
money received on a regular basis from work, property, business, investment, or welfare
what is inflation?
general rise in prices across all sectors of the economy
what is labour?
human skills and effort required to produce goods and services
what is the labour market?
buying and selling of labour
what is laissez-faire?
no government interference in the economy
what is macroeconomics?
branch of economics that emphasises central role played by the level of expenditure or aggregate demand
what is a mark up?
fixed percentage or dollar figure added to the cost price of goods and services to determine selling price
what is microeconomics?
branch of economics that studies smaller fragments/units making up the whole economy
what is monetary policy?
the reserve bank using interest rates to achieve economic objectives
what is a mortgage?
loan from a financial institution, such as a bank where something is held as security in case loan is not repaid, e.g. a house
what is a multilateral agreement?
agreement between three or more nations
what are multinational corporations (MNCs)?
large business organisations that have a home base in one country and operate partially or wholly owned businesses in other countries
what are negative externalities?
production outcome that was not intended and negatively impacts our economy and/or society
what is protection???
policy whereby a government gives local producers artificial advantage, e.g. imposes tariffs on imports
what are qualitative measures?
determine/measure quality of our life and the economy by examination of a series of qualitative indicators, such as freedom or security
what is quarterly?
every three months
what are quotas?
quantity limits or targets for production or imports
what is a recession?
relatively mild contraction in level of economic activity, resulting in reduced spending, rising unemployment, and slow rate of economic growth
what is a regimen?
basket of goods and services whose prices are surveyed to calculate inflation
what are subsides?
cash payment by government designed to help producers compete by enabling them to sell their product at a lower price than would otherwise occur
what is a subsidy?
payment to a local producer
what is sustainable?
able to last/continue for a long time
what are tariffs?
tax on imports
what is taxation?
government levy/revenue measure that can be used as part of the budget to affect level of prices, growth rate, and distribution of income
