Vocab

Question 0

Business cycle

Answer 0

A fluctuation in aggregate economic output that lasts for several years

Question 1

Absolute advantage

Answer 1

An advantage a country has over other countries in the production of a good or service

Question 2

Comparative advantage

Answer 2

An advantage a country has in producing a good or service because it has no alternative users of it’s resources that would involve a higher return

Question 3

Consumption function

Answer 3

Depicts the relationship between changes in personal disposable income and consumption

Question 4

Cost leadership

Answer 4

A strategy that involves focusing on reducing the costs and time to produce, sell, and distribute a product or service

Question 5

Demand

Answer 5

The quantity of a good or service that a consumer is willing and able to purchase at a given price

Question 6

Deflation

Answer 6

The rate of decline in the price level of goods and services

Question 7

Depression

Answer 7

A deep and long-lasting recession

Question 8

Dumping

Answer 8

A form of predatory pricing in which a manufacturer in one country exports a product at a price that is lower than the priced charged in its home country

Question 9

Economic profit

Answer 9

The amount of profit in excess of normal profit

Question 10

Export subsidies

Answer 10

Payments made by a government to encourage the production and export of specific products

Question 11

Government budget surplus (deficit)

Answer 11

The excess (deficit) of government taxes in relation to government transfer payments and purchases